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* Modest drop in U.S. interest rates widely expected
* Fed set to release policy statement at 2 p.m. EDT
* Apple shares jump on upbeat results, forecast
* AMD leads slide among chip stocks
* Indexes up: Dow 0.01%, S&P 500 0.04%, Nasdaq 0.28% (Updates prices, comments)
By Shreyashi Sanyal
July 31 (Reuters) - U.S. stocks were little changed on Wednesday as investors awaited a widely anticipated interest rate cut by the Federal Reserve and clues on whether it would inaugurate further monetary easing.
With a quarter-percentage-point cut in borrowing costs almost certain, focus will now fall on Fed Chairman Jerome Powell to explain why the move was necessary and what comes next.
The Fed is set to release its policy statement at 2 p.m. EDT (1800 GMT).
Investors are looking beyond the 25-basis-point cut and questioning whether this might be an insurance cut or a shift in monetary policy, said Art Hogan, chief market strategist at National Securities in New York.
Wall Street’s main indexes have had a strong run since a steep selloff in May, with the S&P 500 index now up 20% for the year on hopes that a modest rate cut would help combat slowing growth and boost tame inflation.
Offering support to the main indexes was Apple Inc’s 4.43% gain after the iPhone maker beat quarterly profit and revenue expectations, and forecast strong sales for the current quarter, easing concerns around the impact of the U.S.-China trade war.
This helped the technology sector rise 0.38%, but a 8.30% slide in shares of Advanced Micro Devices Inc capped gains.
The semiconductor maker forecast third-quarter revenue below expectations, hit by lower demand for its chips used in gaming consoles, pushing the Philadelphia Semiconductor index down 1.49%.
The United States and China wrapped up trade talks that both sides described as “constructive,” including discussions over further Chinese purchases of American farm goods and an agreement to reconvene in September.
At 11:35 a.m. ET the Dow Jones Industrial Average was up 1.80 points, or 0.01%, at 27,199.82, the S&P 500 was up 1.23 points, or 0.04%, at 3,014.41 and the Nasdaq Composite was up 22.77 points, or 0.28%, at 8,296.38.
Electronic Arts Inc jumped 5.8%, after the video game publisher posted quarterly revenue beat, riding on the continued success of its battle royale game “Apex Legends”.
Beer maker Molson Coors Brewing Co slid 7.70%, after its quarterly net sales and profit missed estimates on weak demand. The company also said its Chief Executive Officer Mark Hunter was retiring.
The ADP National Employment Report, showed private employers added 156,000 jobs in July, above economists’ expectations and supporting the view of a firm domestic labor market. This comes ahead of the Labor Department’s more comprehensive monthly non-farm payrolls data due on Friday.
Advancing issues outnumbered decliners by a 1.57-to-1 ratio on the NYSE and by a 1.82-to-1 ratio on the Nasdaq.
The S&P index recorded 29 new 52-week highs and two new lows, while the Nasdaq recorded 95 new highs and 45 new lows. (Reporting by Shreyashi Sanyal in Bengaluru; Editing by Arun Koyyur)