Stocks slide after the Fed keeps rates steady Wall Street slips after the Federal Reserve keeps interest rates steady

NEW YORK - U.S. stock indexes slipped Wednesday after the Federal Reserve opted not to cut interest rates for the first time since it began trying to help the economy through easier rates in September.

The S&P 500 fell 0.5% following the Fed's widely expected decision. The Dow Jones Industrial Average dipped 137 points, or 0.3%, and the Nasdaq composite fell 0.5%.

The reaction was also relatively muted in the bond market following the Fed's decision, which could hint at rates staying on hold for a while following their swift drop at the end of 2024. Lower rates would help the economy by making it cheaper for U.S. households and companies to borrow, but the downside is they could also give inflation more fuel.

While Wall Street would almost always prefer lower interest rates, "we would continue to focus on why the Fed won't cut anytime soon, specifically a strong economy and labor, which bodes well for solid corporate earnings growth," said Sameer Samana, senior global market strategist at Wells Fargo Investment Institute.

Wednesday's relatively calm movements for financial markets offered some respite following two days of disruption driven by doubts about the artificial-intelligence boom.

A Chinese upstart, DeepSeek, raised nearly existential questions for some of the AI industry after saying it developed a large-language model that can compete with the world's best without having to use top-flight chips.

Nividia, the company whose stock has almost become a symbol of the AI bonanza, fell 4% Wednesday after plunging nearly 17% Monday and then jumping nearly 9% Tuesday.

Elsewhere on Wall Street, Starbucks rose 8.1% after delivering a better profit for the latest quarter than analysts expected. CEO Brian Niccol said the chain is planning to cut its food and beverage offerings by 30% this year to simplify operations and speed service, part of its efforts to turn the company around.

Brinker International jumped 16.3% after the company behind Chili's restaurants delivered better results than expected.

Frontier Group Holdings climbed 5.3% after announcing it would try for a second time to merge with Spirit Airlines, which sought bankruptcy protection late last year. Frontier said the proposed deal would include newly issued Frontier debt and common stock.

On the losing end of Wall Street was Danaher, which fell 9.7% after the life sciences, biotechnology and diagnostics company reported results for the latest quarter that just missed analysts' expectations.

All told, the S&P 500 fell 28.39 points to 6,039.31. The Dow Jones Industrial Average dipped 136.83 to 44,713.52, and the Nasdaq composite sank 101.26 to 19,632.32.

In the bond market, the yield on the 10-year Treasury held at 4.53%, where it was late Tuesday.