Stocks Stay Higher After Fed Statement

By Saumya Vaishampayan And Josie Cox 

        Stocks remained higher Wednesday after the Federal Reserve's latest policy statement flagged a nagging concern about low inflation, which could give officials a reason to delay raising rates.
        The Fed decided to leave its benchmark interest rate near zero, as expected, and the policy statement didn't send a clear signal about the timing of the first increase in rates.
        The Dow Jones Industrial Average advanced 75 points, or 0.4%, to 17705. The S&P 500 rose 0.4% and the Nasdaq Composite was nearly flat.
        While uncertainty around the timing of the first rate increase could prompt stock swings, many investors say the market should be able to withstand the first few rate increases as the overall level of rates is expected to remain low.
        "Is going from zero to a quarter percentage point going to kill the economy?" said Keith Bliss, senior vice president at brokerage Cuttone & Co. " If it does, we've got bigger issues," he added.
        In an environment with relatively low interest rates and an expanding economy, stocks remain more attractive than bonds, said Wayne Lin, a portfolio manager at QS Investors.
        "The key thing is that economic growth has to translate into earnings," he said. "That's what we're watching."
        On the other side of the Atlantic, the Stoxx Europe 600 closed up 1%, building on Tuesday's 1.1% gain. The gains in U.S. and European stocks followed a rebound in Chinese shares after a three-day slump that knocked 11% off the value of China's main stock index.
        A handful of upbeat corporate reports also lifted stocks Wednesday.
        Gilead Sciences Inc. said Tuesday afternoon its two key hepatitis C drugs generated about $4.9 billion in sales in the second quarter, topping Wall Street estimates. The company again raised its guidance for net product sales for the year. Shares rose 2.9%.
        Also after the bell Tuesday, Citrix Systems Inc. reported better-than-expected earnings for the second quarter and raised its outlook for the year. The company also said its chief executive planned to retire. Shares rose 9.6%.
        Anthem Inc. said Wednesday its revenue rose 8.4% in its second quarter, beating expectations, and the insurer bumped up its full-year guidance for medical enrollment growth. Shares added 0.2%.
        Meanwhile, Twitter Inc. said late Tuesday its second-quarter revenue rose 61%, outpacing expectations. Still, the company remains unprofitable and showed almost no growth in its core users. Shares dropped 14%.
        Write to Saumya Vaishampayan at saumya.vaishampayan@wsj.com and Josie Cox at josie.cox@wsj.com
        (END) Dow Jones Newswires

        July 29, 2015 14:17 ET (18:17 GMT)

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