US stocks rise as Fed holds interest rates steady, Nvidia, Tesla lead gains

US stock indexes rose modestly on Wednesday after the Federal Reserve maintained its main interest rate, as widely expected.

The S&P 500 gained 0.5% in afternoon trading, showing little movement following the Fed’s announcement. The Dow Jones Industrial Average increased by 146 points, or 0.4%, while the Nasdaq composite rose 0.7% as of 2:05 p.m. Eastern time.

Markets remained relatively stable after weeks of volatility, with investors closely watching the Fed's stance on future rate adjustments. Fed officials signaled the possibility of two rate cuts by the end of the year, though they also forecast weaker economic growth and higher inflation.

The median projection for U.S. economic growth was revised down to 1.7% for 2025, compared to 2.1% in December’s estimate.

Tech stocks gain, General Mills falls

Nvidia rose 2.8%, trimming its year-to-date losses to 11.6%, after an investor event reassured markets about demand for artificial intelligence computing. Tesla gained 4.1%, rebounding from two consecutive days of losses.

Meanwhile, General Mills declined 2.2%, despite reporting better-than-expected quarterly profits.

The company’s revenue missed analyst forecasts due to slower snack sales, prompting it to cut full-year revenue and profit expectations, citing ongoing "macroeconomic uncertainty."

Bond market and global markets

In the bond market, the yield on the 10-year Treasury slipped to 4.29% from 4.31% following the Fed’s decision.

The central bank announced plans to reduce the pace of its monthly Treasury reductions, lowering the cap to $5 billion from $25 billion beginning in April.

Overseas, Japan’s Nikkei 225 fell 0.2% after the Bank of Japan held interest rates steady. Japan reported a trade surplus for February, with exports rising over 11%, partly due to manufacturers accelerating shipments ahead of rising tariffs. Other major stock indexes across Europe and Asia saw mixed results.

With inputs from AP