Wall Street's major indexes had lost ground immediately after the Fed announced its rate hike decision. Its statement also said "ongoing increases" to rates would be appropriate.
Investors also digested a full plate of earnings reports. Shares of Exxon Mobil Corp (XOM.N) and United Parcel Service Inc (UPS.N) rose following their respective results, while Caterpillar Inc (CAT.N) and McDonald's Corp (MCD.N) ended weaker after their results.
The heavyweight tech sector (.SPLRCT) dropped 1.9% while energy (.SPNY) shed 2.3%, the biggest drop among the S&P 500 sectors. Shares of Apple Inc (AAPL.O), Amazon.com Inc (AMZN.O) and Google parent Alphabet Inc (GOOGL.O), which are due to post results later this week, all slumped.
About 15 minutes into trading, the Dow Jones Industrial Average was down 0.1 percent at 33,944.19.
It’s a shock that forces Wall Street to reexamine its confidence in India’s expansion and its pro-business government, which helped the benchmark Sensex index trade last quarter at the highest in a decade versus the S&P 500.
About 25 minutes into trading, the Dow Jones Industrial Average was up 0.2 percent at 34,019.22.
The company shocked the market on Thursday with a revenue outlook that was short of Wall Street estimates by about $3 billion.
Investors in Asia and Europe tracked a rally on Wall Street fuelled by the figures, while they are now awaiting the release of key inflation data later Friday and then the Federal Reserve's latest policy decision next week.
While all three major U.S. stock indexes advanced, megacap momentum stocks, buoyed by Tesla Inc's (TSLA.O) earnings beat and upbeat sales forecast, helped put the Nasdaq in the lead.
Oil prices gained about 1% on expectations that demand will strengthen as top oil importer China reopens its economy, while gold eased after hitting a 9-month peak.
In fact, the 84-year-old money manager calculated that the value of the S&P 500 at the end of the year should be about 3,200, he says in a paper out Tuesday.
A spate of NYSE-listed stocks were halted at the top of the session due to an apparent technical malfunction, which caused initial price confusion and prompted an investigation by the U.S. Securities and Exchange Commission (SEC).
All three major stock indexes extended Friday's gains, with the tech-heavy Nasdaq leading the pack, boosted by semiconductor shares (.SOX).
Liquidity was thin during Asian trading hours as markets in China, Hong Kong, Singapore, Malaysia, South Korea and Taiwan were closed for the Lunar New Year holiday.
The Dow Jones Industrial Average rose 330.93 points, or 1 percent, to 33,375.49, the S&P 500 gained 73.76 points, or 1.89 percent, to 3,972.61 and the Nasdaq Composite added 288.17 points, or 2.66 percent, to 11,140.43
About 15 minutes into trading, the Dow Jones Industrial Average was down less than 0.1 percent at 33,030.31.
A report from the Labor Department showed weekly jobless claims were lower than expected, indicating the labor market remains solid despite the Fed's efforts to stifle demand for workers.
Stock Market News: Investors will be watching out for December quarter results including IndusInd Bank, Hindustan Unilever and Asian Paints.
Before the market opened, U.S. economic data showed retail sales and producer prices declined more than expected in December, while production at U.S. factories fell more than expected and November output was weaker than thought.
A global stock index was up, but Wall Street stocks were little changed after opening higher.
Morgan Stanley and Goldman Sachs reported a plunge in fourth quarter profits, as Wall Street dealmakers handling mergers, acquisitions and initial public offerings faced a sharp drop in their businesses in 2022
The Dow Jones Industrial Average was up 66 points, or 0.2%, at 34,039, as of 11 a.m. Eastern time, and the Nasdaq composite was 0.4% lower. They also were drifting between gains and losses.
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The much-anticipated report due on Thursday is projected by economists polled by Reuters to show U.S. consumer prices grew 6.5% year-on-year in December, moderating from a 7.1% rise in November.
In his first public appearance of the year, Powell said at a forum sponsored by the Swedish central bank that the Fed's independence is essential for it to battle inflation.