Wednesday, May 20, 2009
Stocks are holding on to modest gains after the Federal Reserve said it expects the economy to improve in coming months even as policymakers lower their expectations for all of 2009.
The stock market's initial reaction to the Fed's economic assessment was negative, as the central bank said unemployment could reach 10%. But the major indexes recovered as the Fed said it sees tentative signs of improvement in the economy. The central bank expects business sales and factory production will begin to gradually recover later this year.
Stocks have been fluctuating Wednesday as rising commodity prices drive energy and material stocks higher. Bank stocks have wavered.
The Dow Jones industrials are up 25 at 8,500 after being up 35 ahead of the minutes. The Standard & Poor's 500 index is up 4 at 912, and the Nasdaq composite index is up 9 at 1,743.