Stock market today: Most of Wall Street edges lower after Fed delivers a big cut to rates

NEW YORK (AP) — U.S. stock indexes edged lower Wednesday after the Federal Reserve kicked off its efforts to prevent a recession with a bigger-than-usual cut to interest rates.

The S&P 500 slipped 0.3% to pull 0.9% below its all-time high set in July. The Dow Jones Industrial Average dipped 103 points, or 0.2%, though it remains close to its record set on Monday. The Nasdaq composite lost 0.3%.

The momentous move by the Fed helps financial markets in two big ways. It eases the brakes off the economy, which has been slowing under the weight of higher rates, and it gives a boost to prices for all kinds of investments. Besides stocks, gold and bond prices had already rallied in recent months on expectations that cuts to rates were coming.

Because the move was so well telegraphed, and because markets had already climbed so much in anticipation of it, Wall Street’s reactions were relatively muted despite the Fed’s historic action. It marked the first cut to the federal funds rate in over four years, and it closed the door on a stretch where the Fed kept rates at a two-decade high to slow the economy enough to stifle the worst inflation in generations.

Now that inflation has eased significantly from its peak two summers ago and appears to be heading toward 2%, the Fed says it it can turn more of its attention toward protecting the slowing job market and overall economy.

“The time to support the labor market is when it’s strong and not when you begin to see the layoffs,” Fed Chair Jerome Powell said. “That’s the situation we’re in.”

The only question is how much the Fed will ultimately cut rates by to do so, which can prove to be a tricky balance. Lowering rates would help the economy by making it easier for U.S. businesses and households to borrow. But it could also offer more fuel for inflation.

The Fed released forecasts Wednesday that said its median official expects to cut the federal funds rate by another half of a percentage point through the end of the year. That could mean a traditional-sized cut of a quarter of a percentage point at each of its two remaining meetings scheduled for 2024.

After that, the median Fed official is projecting another full percentage point of cuts during 2025.

Some critics say the Federal Reserve may have already kept interest rates too high for too long, doing damage to the economy.

“When the Fed is behind the curve, it sometimes takes a big move to catch up to where they should have been all along,” said Brian Jacobsen, chief economist at Annex Wealth Management.

“We don’t think we’re behind,” Powell said in a press conference following the Fed’s announcement. “We think this is timely. But I think you can take this as a sign of our commitment not to get behind,” pointing to Wednesday’s hefty cut of half a percentage point. Powell called it a “good strong start to this.”

Other critics, meanwhile, say the Fed will need to be careful about cutting rates too much because of the possibility that inflation will remain stubbornly higher than it’s been in recent decades.

Powell repeated several times that the Fed does not feel “a rush to get this done” and will make its decisions on interest rates at each successive meeting, depending on what incoming data say.

“We’ll move as fast or as slow as we think is appropriate in real time,” he said. For now, he said, “the U.S. economy is in a good place, and our decision today is designed to keep it there.”

Like stock prices, Treasury yields wavered up and down repeatedly immediately after the Fed announced its cut and published its projections.

The 10-year Treasury yield eventually rose to 3.70% from 3.65% late Tuesday. The two-year yield, which more closely follows expectations for Fed action, edged up to 3.62% from 3.60% late Tuesday.

On Wall Street, Intuitive Machines soared 38.3% after NASA awarded it with a contract worth up to $4.82 billion for communication and navigation services the space agency will use to establish a long-term presence on the moon.

Trading in Tupperware Brands remained halted after the company filed for Chapter 11 bankruptcy protection. Its stock has been sinking, down to 51 cents, since a mini-revival early in the pandemic sent its stock above $30.

McGrath RentCorp, a company that rents and sells mobile office trailers, portable classrooms and other structures, fell 3.1% after it agreed to terminate its proposed buyout by WillScot following tough scrutiny of the deal from U.S. regulators.

All told, the S&P 500 slipped 16.32 points to 5,618.26. The Dow dropped 103.08 to 41,503.10, and the Nasdaq composite lost 54.76 to 17,573.30.

In stock markets abroad, indexes fell modestly in Europe after rising in much of Asia.

The Bank of Japan and the Bank of England are also holding monetary policy meetings later this week. Neither central bank is expected to move on rates, though the language of what the officials say could be an indicator of later moves and still influence markets.

AP Business Writers Yuri Kageyama and Matt Ott contributed.

Specialist Genaro Saporito, foreground, works with traders at his post on the floor of the New York Stock Exchange, Wednesday, Sept. 18, 2024. (AP Photo/Richard Drew)

The news conference of Federal' Reserve Chair Jerome Powell appears on a screen as trader Neil Catania works on the floor of the New York Stock Exchange, Wednesday, Sept. 18, 2024. (AP Photo/Richard Drew)

Trader Michale Conlon, right, works on the floor of the New York Stock Exchange as Federal Reserve Chair Jerome Powell's news conference appears on a television screen behind him, Wednesday, Sept. 18, 2024. (AP Photo/Richard Drew)

Trader Edward Curran works on the floor of the New York Stock Exchange, Wednesday, Sept. 18, 2024. (AP Photo/Richard Drew)

Specialist John O'Hara works at his post on the floor of the New York Stock Exchange, Wednesday, Sept. 18, 2024. (AP Photo/Richard Drew)

Trader Leon Montana works on the floor of the New York Stock Exchange, Wednesday, Sept. 18, 2024. (AP Photo/Richard Drew)

Trader Aaron Ford works on the floor of the New York Stock Exchange, Wednesday, Sept. 18, 2024. (AP Photo/Richard Drew)

Trader Michael Capolino works on the floor of the New York Stock Exchange, Wednesday, Sept. 18, 2024. (AP Photo/Richard Drew)

A bus passes the Wall St. subway station on Wednesday, Sept. 18, 2024, in New York. (AP Photo/Peter Morgan)

The New York Stock Exchange, with a banner for American Eagle Outfitters, is shown on Tuesday, Sept. 17, 2024, in New York. (AP Photo/Peter Morgan)

A person stands near an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, Sept. 18, 2024, in Tokyo. (AP Photo/Eugene Hoshiko)

People stand near an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, Sept. 18, 2024, in Tokyo. (AP Photo/Eugene Hoshiko)

People stand in front of an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, Sept. 18, 2024, in Tokyo. (AP Photo/Eugene Hoshiko)

A person rides a bicycle in front of an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, Sept. 18, 2024, in Tokyo. (AP Photo/Eugene Hoshiko)

VANCOUVER, British Columbia (AP) — Jake Sanderson scored 15 seconds into overtime and the Ottawa Senators stretched their win streak to six games with a 5-4 victory over the Vancouver Canucks on Saturday night.

It’s the first time since March 2017 that Ottawa has won six in a row.

Shane Pinto scored twice for the Senators, Claude Giroux added a goal and Josh Norris scored short-handed. Sanderson also contributed a pair of assists.

Leevi Merilainen stopped 21 shots to earn his first NHL victory.

Brock Boeser scored twice for the Canucks, and Quinn Hughes had a goal and two assists. Jake DeBrusk rounded out the scoring for a Vancouver side that lost its third straight outing (0-1-2). Kevin Lankinen made 17 saves.

Canucks: The team has lost four of its last five outings and some of its top stars have gone cold offensively. J.T. Miller has not scored in the six games he’s played since returning from a 10-game absence, Elias Pettersson does not have a point in his last six outings and Conor Garland last recorded a goal on Nov. 29.

Senators: Merilainen stepped in for Linus Ullmark, who has been a superstar for Ottawa in recent weeks. Heading into Saturday, Ullmark had powered the team to five straight victories after backup Anton Forsberg went down with an injury during a pre-game skate on Dec. 14.

Boeser knotted the score at 4 with 4:50 left in the game when he blasted a rebound past Merilainen.

Hughes now has 40 points on the season (eight goals, 32 assists). He is the seventh defenseman in NHL history to hit the mark in 33 or fewer games in multiple seasons.

The Senators visit the Edmonton Oilers on Sunday, and the Canucks host the San Jose Sharks on Monday.

AP NHL: https://www.apnews.com/hub/NHL

Ottawa Senators' Jake Sanderson (85) scores on Vancouver Canucks goaltender Thatcher Demko (35) during overtime of an NHL hockey game in Vancouver, British Columbia, Saturday, Dec. 21, 2024. (Ethan Cairns/The Canadian Press via AP)

Ottawa Senators goaltender Leevi Merilainen (1) stops the puck against the Vancouver Canucks during the third period of an NHL hockey game in Vancouver, British Columbia, Saturday, Dec. 21, 2024. (Ethan Cairns/The Canadian Press via AP)

Vancouver Canucks' Brock Boeser, right, celebrates his goal against the Ottawa Senators with Quinn Hughes (43) during the third period of an NHL hockey game in Vancouver, British Columbia, Saturday, Dec. 21, 2024. (Ethan Cairns/The Canadian Press via AP)

Ottawa Senators' Jake Sanderson (85) celebrates his game-winning goal with Brady Tkachuk (7) after overtime of an NHL hockey game against the Vancouver Canucks in Vancouver, British Columbia, Saturday, Dec. 21, 2024. (Ethan Cairns/The Canadian Press via AP)