Dow rises 400 points to record close after Fed says 3 rate cuts are on the way: Live updates

Stocks surged on Wednesday and all the major averages hit all-time closing highs after the Federal Reserve held rates steady and kept plans to cut three times before the end of the year intact.

The Dow Jones Industrial Average rallied 401.37 points, or 1.03%, to finish at 39,512.13. The S&P 500 gained 0.89% to close at 5,224.62, punching above the 5,200 level for the first time ever. The Nasdaq Composite jumped 1.25% to settle at 16,369.41.

— Samantha Subin

Here are some of the stocks breaking all-time highs during Wednesday's session:

• AutoZone trading at all-time high levels back to its IPO in April, 1991
• Chipotle Mexican Grill trading at all-time high levels back to its IPO in Jan, 2006
• Hilton Worldwide trading at all-time highs back to its IPO in Dec, 2013
• O'Reilly Auto trading at all-time high levels back to its IPO in Apr, 1993
• Oneok trading at all time high levels back through our history to 1979
• Valero trading at all-time highs back to its spin-off from PG&E Corp in 1980
• Arch Capital Group trading at all-time high levels back to when it began trading on the NASDAQ in 2000
• Ameriprise Financial trading at all-time highs back to its IPO in Oct, 2005
• Fiserv trading at all-time high levels since its IPO in Sep, 1986
• JPMorgan trading at all-time high levels back to its IPO in 1983
• MasterCard trading at all-time high levels since its IPO in May, 2006
• Travelers trading at all-time highs back to its spin-off from Citi in 2002
• HCA trading at all-time high levels back to its IPO in March, 2011Molina Healthcare (MOH) trading at all-time highs back to its IPO in June, 2003
• Cummins Inc trading at all-time highs back to its IPO in 1947
• Fastenal trading at all-time high levels back to its IPO in August, 1987
• General Dynamics trading at all-time high levels back to 1952 when it was incorporated and listed on the NYSE
• Hubbell trading at all-time highs back through our history to 1972
• PACCAR trading at all-time high levels back to its IPO in 1971
• Rollins Inc trading all-time highs back to when it began trading on the NYSE in 1968
• Textron trading at all-time highs back to when it began trading on the NYSE in 1947
• Arista Networks trading at all-time high levels back to its IPO in June, 2014
• Gartner trading at all-time highs back to its IPO in Oct, 1993
• Oracle trading at all-time high levels back to its IPO on March 12, 1986
• NRG Energy trading at all-time highs back to its IPO in May, 2000

— Samantha Subin

Actively managed mutual funds and exchange-traded funds fell short of passive funds in 2023, but within the bond category, active management stood out, according to Morningstar.

Some 53% of active bond managers survived and beat the passive average in 2023, up from 30% in 2022, the research firm said in a recent report. Active intermediate core bond managers had the highest success rate at 57%, up from 38% the year prior, Morningstar found.

Active managers in intermediate core bond funds tend to take more credit risk through the corporate bond market or mortgage-backed securities compared to indexed funds. That's what helped them outperform last year, said Paul Olmsted, senior manager research analyst at Morningstar.

"You had not only, in 2023, a higher income component of active management versus the index, you also had credit spreads tighten," he said.

To see the top performing active bond funds right now, read the CNBC Pro story here.

— Michelle Fox

Stocks rallied this afternoon after the Federal Reserve announced it would keep rates steady in March but the Fed's dot plot revealed plans for three rate cuts in 2024.

"The immediate market reaction is the relief we were expecting. Investors were worrying the Fed was going to pull back from rate cuts this year, so keeping three rate cuts on the table naturally pushes stocks higher and bonds yields lower," said Bryce Doty, a portfolio manager at Sit Investment Associates.

Doty added that it's a positive sign for investors to see that the Fed understands that it can still cut rates without compromising its tough stance on ifnlation.

— Lisa Kailai Han

Shares of Paramount Global rose more than 9% after a report from the Wall Street Journal that Apollo Global Management had offered $11 billion for the entertainment company's film and TV studio.

The reported offer, which the Journal attributed to people familiar with the situation, is more than the market cap for Paramount as a whole.

Paramount declined to comment to CNBC on the story.

— Jesse Pound

Technology and small-cap stocks notably outperformed in afternoon trading as traders responded to the latest updates from the Federal Reserve.

The small-cap focused Russell 2000 climbed 1.5% shortly after 3 p.m. ET, while the technology-heavy Nasdaq Composite added around 1%. By comparison, the broad S&P 500 and blue-chip Dow rose just about 0.7% and 0.8%, respectively.

— Alex Harring

Consumer discretionary and communication services stocks rallied on the back of the Federal Reserve's decision to hold rates steady, boosting their respective S&P 500 sectors 1.3% and 1%, respectively.

Ford Motor and Carnival were the biggest gainers within the consumer discretionary sector, jumping about 4% each. Chipotle Mexican Grill, Royal Caribbean and Etsy added at least 3%. Tesla added 2%, while Amazon inched up more than 1%.

Within communications services, Paramount Global rallied 8%. Warner Bros. Discovery and Take-Two Interactive each added 2%, while Meta Platforms gained 1.8%. Alphabet and Netflix edged up about 1% each.

— Samantha Subin

The market may be getting closer to seeing the Federal Reserve's first interest rate cut, but it doesn't feel that way, according to Greg McBride, chief financial analyst at Bankrate.

Although the central bank said Wednesday that it still sees rate cuts as a possibility this year, it isn't confident enough yet that inflation is on track for its 2% target, McBride said.

"The Fed statement was largely a 'copy and paste' from January, reflecting the fact that after two disappointing months of inflation data, the Fed is no closer to having the necessary conviction that inflation is on a consistent journey to 2%," he said, adding, "Interest rates took the elevator going up but will take the stairs coming down."

— Tanaya Macheel

The Fed kept interest rates unchanged, as expected. The central bank's so-called dot plot also showed the central bank still sees three rate cuts taking place in 2024.

— Fred Imbert

Here are the stocks making the biggest moves during midday trading:

• Signet Jewelers — Shares tumbled 11% after the jeweler issued first-quarter revenue guidance that missed Wall Street estimates.
• Chipotle — Shares rose 6.4% to an all-time high after the fast-casual Mexican chain announced the board approved a 50-to-1 stock split.
• Mobileye Global — The stock gained 6% after Volkswagen announced it will ramp up collaboration with the automotive tech company.

Read the full list of stocks on the move here.

— Tanaya Macheel

Chipotle announced Tuesday that its board approved a 50-to-1 stock split. While it's largely a cosmetic move to make shares appear more affordable, stock splits have historically prompted outperformance.

CNBC Pro subscribers can click here to see what history shows the stock could be in for.

— Alex Harring

Astera Labs soared in its first session as a publicly traded company.

The artificial intelligence and cloud infrastructure stock surged more than 50% in midday trading on Wednesday, its first as a listed company on the Nasdaq. Astera announced Tuesday it would price its initial public offering at $36 per share.

— Alex Harring

TastyLive CEO Tom Sosnoff said Wednesday that Reddit will be a unique stock when it goes public this week.

"I think Reddit's going to be a really interesting play because it's going to be, for most investors, the only tradable pure social media app," Sosnoff told CNBC's "Squawk Box."

Sosnoff is already an investor in Reddit, having purchased equity in the company through a private sale last year.

Watch Sosnoff's full interview here.

— Jesse Pound

Boeing was the top performer in the Dow Jones Industrial Average on Wednesday, gaining more than 2% amid a flurry of news around the beleaguered airline operator.

Bloomberg, citing sources familiar, reported Boeing is exploring a possible sale of at least two of its defense businesses. Reuters, citing unnamed sources, said Boeing is exploring how Spirit AeroSystems can cut or reduce ties with Airbus.

Elsewhere, Boeing on Wednesday said it expects to burn more cash in the first quarter than previously anticipated, while also limiting 737 production to improve quality.

Boeing shares are down nearly 29% this year.

— Sarah Min

Energy and healthcare stocks lagged during early morning trading, dragging down their respective S&P 500 sector by about 0.4%.

Halliburton and Hess Corp were the worst performers in the energy sector, slipping more than 1% each. Diamondback Energy and Chevron also declined about 1% each.

Within the health care sector, Insulet and Moderna dropped more than 3% each. AbbVie, Regeneron and Dexcom edged down at least 1% each.

— Samantha Subin

Signet Jewelers shed 11.7% during Wednesday's session and headed for its worst day since September 2022.

The decline in shares came after the jewelry retailer offered first-quarter revenue guidance that fell short of Wall Street estimates. Signet said it expects revenues to range between $1.47 billion and $1.53 billion, versus a FactSet estimate of $1.61 billion.

The stock is down 15% year to date.

— Samantha Subin

Chipotle shares rose more than 7% on Wednesday, hitting a record above $3,000. The move higher comes after the fast casual chain approved a 50-to-1 stock split.

"Even though the stock split theoretically does not change the underlying economic value of CMG, we view this announcement as a positive for the shares in the sense that the move should aid trading liquidity and ultimately broaden the investor audience," Baird analyst David Tarantino wrote Wednesday.

— Fred Imbert

This liquid cooling stock and derivative play on Nvidia has surged nearly 500% over the last year.

One bull case, in particular, estimates that shares could nearly double from here, viewing the company as a unique way to play data center growth.

Read more on the stock poised to benefit from Nvidia's liquid cooling aspirations here.

— Samantha Subin

The S&P 500 opened flat on Wednesday, while the Dow Jones Industrial Average dipped 0.2%, or about 80 points. The Nasdaq Composite inched up 0.2%.

— Samantha Subin

Check out some of the companies making headlines in premarket trading.

• Chipotle — Shares rose 5% in premarket trading after the fast-casual Mexican chain announced a 50-to-1 stock split. The change, which was shared with the public on Tuesday, is expected to go into effect in June if approved by shareholders in a vote scheduled for earlier that month. Elsewhere, Deutsche Bank raised its price target on the stock, citing strong growth prospects.

• CarMax — Shares of the used car dealer climbed 2% after an upgrade to buy from hold by Needham. The investment firm said the used vehicle market could be on the verge of a multiyear recovery.

• Riot Platforms — The stock rose 4.1% after JPMorgan upgraded the bitcoin mining company to overweight from neutral. Analyst Reginald Smith cited Riot's "unique combination of industry-leading power contracts, scale and liquidity" as catalysts, and added that he thinks the name offers the best relative upside amongst the biggest U.S.-listed crypto miners.

Read the full list here.

— Brian Evans

Chipotle shares jumped more than 5% in premarket trading after the fast-casual Mexican chain announced a stock split.

The 50-to-1 split, which was shared with the public on Tuesday, is expected to go into effect in June if approved by shareholders earlier that month. Chipotle described it as one of the biggest splits in the history of the New York Stock Exchange.

The move comes amid a period of strength for shares of the California-based company. Shares have jumped more than 20% in 2024 and 70% over the last 12 months.

Elsewhere, Deutsche Bank raised its price target on the stock, citing Chipotle's strong growth outlook.

— Alex Harring

Intel shares rose more than 3% before the bell on news that the White House will award the chipmaker up to $8.5 billion in CHIPS Act funding and as much as $11 billion in loans.

The news comes as the Biden administration looks to bolster the domestic semiconductor industry and bring production to U.S. soil.

— Samantha Subin

Shares of South Korean heavyweight Samsung Electronics soared more than 5% after chip giant Nvidia reportedly said the South Korean chipmaker's high bandwidth memory chips were in the "qualifying" stage for use in Nvidia's graphics processing units.

This comes after rival SK Hynix announced that it was set to deliver its high-bandwidth memory (HBM) chips to customers, with Reuters saying that Nvidia would be its first client. Shares of SK Hynix plunged as much as 3.56% on Wednesday.

— Lim Hui Jie

China's central bank left its one- and five-year loan prime rates unchanged at 3.45% and 3.95%, respectively.

The one-year LPR acts as the peg for most household and corporate loans, while the five year LPR is the benchmark for most property mortgages.

Separately, Reuters reported that the PBOC has reshuffled its monetary policy committee to include securities regulator head Wu Qing and vice central bank chief Xuan Changneng.

— Lim Hui Jie

The Japanese yen hit a four-month low on Tuesday to hit 151.3 against the greenback after the country's central bank made a landmark policy shift to its monetary policy. This is its lowest level since it hit 151.71 on Nov. 13.

If yen break's past the Nov. 13 low, it will be at its weakest against the U.S. dollar since June 1990, when the country's asset bubble burst.

The Bank of Japan raised interest rates from -0.1% to around 0%-0.1% and scrapped its yield curve control policy.

— Lim Hui Jie

Chipotle Mexican Grill was higher by more than 4% in extended trading after the board of directors approved a 50-for-1 split of its common stock.

— Sarah Min

There could be some volatile trading over the next several months, according to RBC Capital Markets.

Technical strategist Robert Sluymer told clients that the S&P 500 and Nasdaq Composite have "merely traded sideways in a narrow choppy range" over the past two weeks and haven't shown evidence of a true reversal on their uptrends. Looking ahead, he cautioned of hectic trading movements into the second quarter of the year.

"We expect further volatility into Q2 that likely sees both indexes trade in choppy sideways trading ranges," Sluymer wrote to clients.

While he said stocks should see further upside this year, he noted that there may be a short-term pause or pullback in the upcoming quarter.

— Alex Harring

Stock futures opened little changed Tuesday night.

Dow Jones Industrial Average futures was flat. S&P 500 futures dipped 0.03%, while Nasdaq 100 futures climbed 0.03%.

— Sarah Min