QQQ ETF outperforms S&P 500 after Fed decision

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Shares of the Invesco QQQ Trust, which tracks the technology-heavy Nasdaq-100 index, finished lower Wednesday after the Federal Reserve announced an interest rate hike that was in line with expectations.

The Invesco QQQ Trust
ended down 1.4%, after flipping between gains and losses earlier in the session, while the SPDR S&P 500 ETF Trust
dropped 1.7%, according to FactSet data. The Invesco QQQ Trust has soared 15% this year through Wednesday, far outpacing the S&P 500 ETF Trust’s gain of 2.5%.

The Federal Reserve announced Wednesday that it raised its benchmark interest rate by a quarter percentage point, as expected, to a target range of 4.75% to 5% as it continues fighting high inflation after taking recent steps to shore up confidence in the U.S. banking sector. The Fed’s “dot-plot” forecast showed just one more rate hike this year, with no rate cuts projected.

Read: Fed hikes interest rates again, pencils in only one more increase

“The U.S. banking system is sound and resilient,” the Fed said in its statement released Wednesday afternoon. “The Committee remains highly attentive to inflation risks.”

Meanwhile, Treasury yields fell.

The yield on the 10-year Treasury note
slid 10.6 basis points Wednesday to 3.497% , while two-year Treasury yields
dropped 19.8 basis points to 3.977%, according to Dow Jones Market Data.

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