U.S. stocks fell after the Federal Reserve raised interest rates and signaled it isn’t ready to claim victory over inflation yet, bolstering speculation on another hike this year.

The S&P 500 dropped from the highest level since April 2022, the tech-heavy Nasdaq 100 underperformed and Dow Jones Industrial Average wavered. If the blue-chip gauge closes higher, it will be its 13th straight gain — the longest winning run since 1987. Two-year US yields and the dollar were little changed.

The Fed raised interest rates to the highest level in 22 years and left the door open to additional increases as officials fine-tune their effort to further quell inflation. Traders will now focus on Fed Chair Jerome Powell’s press conference at 2:30 p.m. in Washington.

BIG TECH EARNINGS

Another driver of trading Wednesday was the large batch of earnings reports, with results from big tech being highly scrutinized after the shares notched a historic advance in the first six months of the year.

Google parent Alphabet Inc. climbed as revenue beat expectations, while Microsoft Corp. fell on a tepid sales growth and Texas Instruments Inc.’s lukewarm forecast weighed on chipmakers. Traders also awaited results from Facebook owner Meta Platforms Inc. The social media giant goes into its second-quarter earnings report with a relatively inexpensive valuation that could provide a cushion against any minor misses.

“Big tech earnings have been very Darwinian, and investors are only rewarding the companies that truly post strong results,” David Bahnsen, chief investment officer at the Bahnsen Group. “After extreme gains so far this year in big tech stocks, we have now moved to a phase where each company’s stock price is very non-correlated to one another.”

CORPORATE HIGHLIGHTS

Boeing Co. rose after generating US$2.58 billion in free cash flow in the second quarter, far exceeding expectations, amid a flurry of jet deliveries.

Regional banks climbed as news that PacWest Bancorp is being bought by Banc of California bolstered confidence in the industry. Wells Fargo & Co. paced gains in larger lenders on plans to repurchase as much as $30 billion of its shares.

Rail giant Union Pacific Corp. advanced after appointing Jim Vena as its new chief executive officer. Retailer Gap Inc. gained after naming Mattel Inc.’s Richard Dickson as its next CEO.

Coca-Cola Co. raised its full-year guidance after second-quarter results show continued momentum and consumer willingness to pay higher prices to quench their thirst with the company’s sugary sodas, fruit juices and sports drinks.

AT&T Inc. reported profit and free cash flow that topped analysts’ estimates, offering a brighter picture as the phone giant faces a challenging restructuring effort, a heavy debt load and the potentially high costs of cleaning lead out of its old copper phone network.

Visa Inc. posted card-spending growth that was more robust than Wall Street expected as consumer demand for travel and dining out remained strong last quarter.

Snap Inc. fell after projecting revenue at the lower end of analysts’ estimates for this quarter, signaling that improvements to the digital advertising business are taking longer than expected to pay off.

Key events this week:

• China industrial profits, Thursday
• ECB rate decision, Thursday
• U.S. GDP, durable goods orders, initial jobless claims, wholesale inventories, Thursday
• Japan Tokyo CPI, Friday
• BOJ rate decision, Friday
• Eurozone economic confidence, consumer confidence, Friday
• U.S. consumer income, employment cost index, University of Michigan consumer sentiment, Friday

Some of the main moves in markets:

Stocks

• The S&P 500 fell 0.2 per cent as of 2:01 p.m. New York time
• The Nasdaq 100 fell 0.6 per cent
• The Dow Jones Industrial Average rose 0.1 per cent
• The MSCI World index fell 0.2 per cent

Currencies

• The Bloomberg Dollar Spot Index was little changed
• The euro rose 0.2 per cent to $1.1073
• The British pound rose 0.2 per cent to $1.2927
• The Japanese yen rose 0.3 per cent to 140.43 per dollar

Cryptocurrencies

• Bitcoin rose 0.2 per cent to $29,289.49
• Ether fell 0.2 per cent to $1,859.08

Bonds

• The yield on 10-year Treasuries declined one basis point to 3.87 per cent
• Germany’s 10-year yield advanced six basis points to 2.48 per cent
• Britain’s 10-year yield advanced one basis point to 4.28 per cent

Commodities

• West Texas Intermediate crude fell 0.9 per cent to $78.95 a barrel
• Gold futures rose 0.5 per cent to $2,012.80 an ounce