* U.S. central bank downplays Q1 economic weakness
* Apple slips after surprise dip in iPhone sales
* Delphi soars after spinoff announcement
* Dow up 0.01 pct, S&P down 0.21 pct, Nasdaq down 0.5 pct
(Updates with late afternoon trading)
By Lewis Krauskopf
May 3 Wall Street kept losses on Wednesday after
the U.S. Federal Reserve held interest rates unchanged following
its two-day policy meeting, and as investors digested another
heavy round of earnings reports.
The U.S. central bank downplayed weak first-quarter economic
growth and emphasized the strength of the labor market, in a
sign it could tighten monetary policy as early as June.
Investors are betting on a 65-percent chance of a hike in June,
according to Thomson Reuters data.
The S&P financial sector, which is seen benefiting
in a rising rate environment, was up 0.5 percent after the Fed's
bullish statement, leading all groups. Eight of the 11 major
sectors were lower, however.
The Fed is in its first tightening cycle in more than a
decade after it spent years keeping rates near zero to help the
economy following the 2007-2009 recession.
"The Fed is communicating its mantra of gradual rate hikes,"
said Ryan Sweet, senior economist at Moody’s Analytics in West
Chester, Pennsylvania. "The next time they will likely raise
rates would be June."
The Dow Jones Industrial Average rose 1.54 points, or
0.01 percent, to 20,951.43, the S&P 500 lost 5.14 points,
or 0.21 percent, to 2,386.03 and the Nasdaq Composite
dropped 30.57 points, or 0.5 percent, to 6,064.79.
The benchmark S&P 500 has returned to near its all-time high
during an earnings season that generally come in above
First-quarter profits at S&P 500 companies are estimated to
increase 14.2 percent, its strongest growth since 2011,
according to Thomson Reuters I/B/E/S.
Apple shares fell 0.4 percent, weighing on indexes,
but recovering from steeper losses after the company's quarterly
report, in which it reported a surprise fall in iPhone sales.
In other corporate news, Sprint shares slid 13.5
percent after the U.S. wireless carrier did not give specifics
on deals it would pursue, even as its quarterly loss narrowed.
Delphi Automotive shares jumped 9.3 percent after
the company said it plans to spin off operations tied to
internal combustion engines and focus on technology for
electrically powered and self-driving vehicles. The stock was
the biggest percentage gainer in the S&P 500.
The New York Times Co rose 12.2 percent after the
newspaper publisher reported its biggest quarterly revenue
growth in six year.
Declining issues outnumbered advancing ones on the NYSE by a
1.83-to-1 ratio; on Nasdaq, a 2.22-to-1 ratio favored decliners.
The S&P 500 posted 30 new 52-week highs and 7 new lows; the
Nasdaq Composite recorded 78 new highs and 65 new lows.
(Additional reporting by Richard Leong in New York and Tanya
Agrawal in Bengaluru; Editing by Savio D'Souza and Nick