Stocks hit records as Fed trims bond-buying

The S&P 500 and the Nasdaq hit record highs for a fifth straight session on Wednesday as the Federal Reserve came through with an expected plan to start pulling back on the huge help it's been giving to the economy.

The Dow also closed at a record high as well - its fourth in a row. The S&P 500 rose 24 points. The Nasdaq jumped 140.

The Fed announced it will reduce its bond-buying program by $15 billion a month as the economy rebounds. It is keeping its eyes on soaring inflation, which Chairman Powell thinks will start to abate in the second or third quarter of next year....so for now, interest rates will remain near zero.

Michael Gapen of Barclay's says Wall Street gave a thumbs up to what it saw as the Fed's balanced approach.

"I think continuing to emphasize that the US inflation is high, but 'we still expect it to be transitory and to move lower.' I think as a way to balance the overall message of 'we're tapering today, we've seen enough to start that process.' It will in general remove monetary policy accommodation. But 'we're going to soften that with the view that we still think inflation is transitory and will be moving lower.'

The Fed's decision came amid fresh signs of an economic pick-up. Business activity in the vast U.S. services sector surged to a record high in October as an improving public health situation appeared to be boosting demand. The de-escalating health crisis also lifted employment. Private payrolls rose by 571,000 last month, according to a separate survey by payroll processing company ADP.

Earnings season continued to give investor sentiment a lift.

CVS Health beat quarterly sales and profit forecasts and raised its earnings outlook for the year. Shares touched a 5-year high.

Marriott International also beat revenue and earnings targets. The hotel operator is benefitting from a rebound in leisure travel. That stock hit a record high.

Moving the other way - Activision Blizzard. The stock dropped after the video-game publisher behind "Call of Duty" and "Candy Crush" delayed two long awaited titles and its co-leader Jen Oneal is stepping down after only three months sharing the top job. Shares tumbled 14 percent.

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