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* Fed expects moderate economic growth next year
* Indexes up: Dow 0.02%, S&P 500 0.24%, Nasdaq 0.35%
(Updates after Fed decision)
By Lewis Krauskopf
Dec 11 (Reuters) - The benchmark S&P 500 stock index
slightly extended modest gains on Wednesday after the U.S.
Federal Reserve held interest rates steady and signaled that
borrowing costs are likely to remain unchanged indefinitely.
The U.S. central bank said moderate economic growth and low
unemployment are expected to continue through next year's
presidential election. After cutting rates three times earlier this year, the Fed
left its benchmark rate at the target range of between 1.50% and
1.75%, a decision that was widely expected.
"You are looking at a cautiously optimistic Fed," said Karl
Schamotta, chief market strategist at Cambridge Global Payments
in Toronto. "The tone that you see through the statement and
projections suggest that they believe that they have taken out
enough insurance to prevent a downturn."
With the Fed expected to stand pat on rates, investors have
been more focused on U.S.-China trade relations, including new
tariffs on Chinese goods that could go into effect on Dec. 15.
The Dow Jones Industrial Average .DJI rose 5.65 points, or
0.02%, to 27,887.37, the S&P 500 .SPX gained 7.43 points, or
0.24%, to 3,139.95 and the Nasdaq Composite .IXIC added 30.05
points, or 0.35%, to 8,646.23.
Most S&P 500 sectors were higher, with materials .SPLRCM
and technology .SPLRCT leading the way.