Stocks gave up initial gains to end slightly lower Thursday as an early attempt to extend Wednesday's post-FOMC rally faltered. Megacaps led the morning uptick in the major averages and led the afternoon weakness amid lack of conviction and news. The Dow Jones industrial average was flat, the S&P 500 eased by 0.2 percent, and the Nasdaq was down 0.3 percent. US bond yields mostly declined while the dollar and oil prices rose.

Equities lacked direction Thursday as Wednesday's FOMC news and the Fed's data-dependent stance spoke to uncertainty at the Fed and in markets about the economic outlook. Everyone is watching to see what comes next from President Trump on tariffs and how the economy responds. Underlying sentiment remains bearish given expectations for more negative fallout from the tariffs. The Fed acknowledged in various statements Wednesday that tariffs will slow growth and raise inflation, at least in the near term. On the positive side Thursday, existing home sales topped expectations as consumers evidently responded favorably to more houses coming on the market, and weekly jobless claims remained relatively stable.

Among stock sectors, worst performers Thursday included technology, industrials, consumer staples, and materials. Holding up best were financials, energy, utilities and health care.

Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.

Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.