Stock futures seemed slightly lower before the Fed decision

On Wednesday, in early morning trading, the U.S. stock futures held muted as investors expected a decision from the Federal Reserve on its schedule.

Dow Jones Industrial Average futures dropped 38 points. Nasdaq 100 futures and S&P 500 traded in moderately negative territory.

In after-hours trading, Lyft bounced approximately 14% on better-than-expected quarterly results. Zillow dropped more than 12% after declaring that it would close its home buying and flipping business. On a partnership announcement with Kroger, Bed Bath & Beyond shares increased, but a short squeeze fueled the nearly 70% after-hours surge that followed.

In regular trading, the Dow climbed 138.78 points to 36,052.64. The S&P 500 added 0.4%, while the Nasdaq Composite gained 0.4%. All three main averages closed at records. It happened for the third session in a row. 

The small-cap Russell 2000 increased slightly, but it closed at an all-time high.

Investors are mainly focused on the Federal Reserve while expecting them to announce an end to its bond-buying program after its two-day meeting on Wednesday. They will also attend and listen for hints on when the central bank intends to increase interest rates.

Overview

On Tuesday, equities increased as companies continued to deliver robust earnings reports. According to FactSet, from the S&P 500 companies that have already reported this earnings season, 84% of them have beat consensus expectations. That happened despite continuing coronavirus risks, supply chain interruptions, commodity inflation, labor shortages, and central bank policy.

According to chief market strategist for LPL Financial, Ryan Detrick, stocks resemble the Energizer Bunny because they continue to rise to new highs without showing any signs of tiring. He said that they understand all of the worries out there, but the conclusion is that earnings continue to come in a better than expected way while helping to justify current stocks levels. Overall, he said that those highs seem to make a potential year-end rally more understandable to investors.

Co-chief investment officer at Trust, Keith Lerner, said that the primary market trend seems higher. According to his analysis, the S&P 500 shifted on additional gains by year-end with an average growth of 6.3%. He said that in the eight periods since 1950, stocks increased more than 20% through October.

There are some other reports scheduled to be released, including ADP payrolls data and weekly mortgage applications. On Wednesday, before the bell, CVS and Marriott will report earnings.