US stocks were mixed on Wednesday after the Federal Reserve hiked interest rates by 25 basis points, sending the effective fed funds rate to its highest level in 22-years.
While the S&P 500 and Nasdaq 100 traded slightly lower, the Dow Jones Industrial Average managed to finish the day higher, hitting a 13-day win streak. The Dow has surged just over 5% since its rally began on July 10, and hasn't seen a 13-day run of gains since January 1987, according to data compiled by Bloomberg.
While Fed Chairman Jerome Powell left open the possibility for further interest rate hikes to combat elevated inflation, markets think that today marketd the last interest rate hike of the current tightening cycle, according to the CME FedWatch Tool. "If the inflation data come in soft enough and the labor market loosens, investors can reasonably expect the Fed to pause in September," LPL's chief economist Jeffrey Roach told Insider."The Fed is likely at a balanced position right now since the risk of raising rates too much is roughly balanced with the risk of raising too little."
There will be two inflation reports and two jobs reports released between now and the Fed's next FOMC meeting in September.
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