US STOCKS-Stocks approach record as Fed soothes Wall Street's fears

Reuters

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    * Fed holds rates steady, signals potential cuts this year
    * Adobe buoys S&P 500 after strong quarterly results 
    * Dow up 0.15%, S&P 500 up 0.30%, Nasdaq up 0.42%

 (Updates with closing prices)
    By Noel Randewich
    June 19 (Reuters) - The S&P 500 approached a record high on
Wednesday after the Federal Reserve signaled potential interest
cuts later this year, reassuring investors worried that the
U.S.-China trade war could stall economic growth. 
    Saying it "will act as appropriate to sustain" economic
expansion, the central bank signaled rate cuts of as much as
half a percentage point over the remainder of 2019.  urn:newsml:reuters.com:*:nW1N22I01T
    In its statement following a two-day policy meeting, the Fed
held rates steady, as expected, but dropped a previous promise
to be "patient" in adjusting rates. 
    That elevated the S&P 500 and Dow Jones Industrial average
to less than 1% from their record high closes set in late April.
    "We think the Fed delivered. It did no harm. It walked right
up to a cut without doing it today. It'll likely be coming in
July absent some big trade news or other news," said John
Augustine, chief investment officer at Huntington Bank in
Columbus, Ohio.
    Buoyed by growing confidence the Fed will cut rates, and by
hopes of an end to the U.S.-China trade war, U.S. stocks have
climbed in recent weeks. The S&P 500  .SPX  has gained 6% in
June.
    "At the end of the day what they (the Fed) want to do is
give a nod to the market. Expectations had gotten so dovish that
they need to give a nod to that, but at the same time not make
any commitment and be forced to cut rates later on if conditions
perhaps changed," said Kristina Hooper, Chief Global Market
Strategist at Invesco in New York.
    The financial sector  .SPSY  fell 0.2%, with bank stocks
 .SPXBK  dipping 0.2%. Lower interest rates tend to hurt banks'
profits.
    The Dow Jones Industrial Average  .DJI  rose 0.15% to end at
 26,504.27 points, while the S&P 500 gained 0.30% to 2,926.44.
    The Nasdaq Composite  .IXIC  added 0.42% to 7,987.32. 
    Contributing more than any other stock to advances on the
Nasdaq and S&P 500, Adobe Inc  ADBE.O  surged 5.2% after the
Photoshop software provider beat analysts' estimates for
quarterly profit and revenue.  urn:newsml:reuters.com:*:nL4N23P40C
    Facebook  FB.O  fell 0.5% as its ambitious plan to launch a
digital currency faced a backlash from regulators and
politicians in the United States and abroad.  urn:newsml:reuters.com:*:nL2N23P06G
    The healthcare sector  .SPXHC  rose 1%, helped by gains in
UnitedHealth Group Inc  UNH.N , Pfizer Inc  PFE.N  and Allergan
Plc  AGN.N . 
    Allergan jumped 6.2% after the drugmaker said its
constipation drug, jointly developed with Ironwood
Pharmaceuticals Inc  IRWD.O , improved symptoms in patients
suffering from irritable bowel syndrome with constipation.
 urn:newsml:reuters.com:*:nL4N23Q2MI 
    Advancing issues outnumbered declining ones on the NYSE by a
1.65-to-1 ratio; on Nasdaq, a 1.40-to-1 ratio favored advancers.
    The S&P 500 posted 48 new 52-week highs and 2 new lows; the
Nasdaq Composite recorded 63 new highs and 59 new lows.  
    Volume on U.S. exchanges was 6.5 billion shares, compared to
the 6.8 billion average for the full session over the last 20
trading days.

 (Reporting by Noel Randewich;
Additional reporting by Shreyashi Sanyal and Aparajita Saxena in
Bengaluru
Editing by Lisa Shumaker, Sonya Hepinstall and Chizu Nomiyama)
 ((noel.randewich@tr.com; Twitter handle: @randewich  (415) 677
2542; Reuters Messaging:
noel.randewich.thomsonreuters.com@reuters.net))

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