Dow closes more than 400 points higher after Fed leaves interest rates steady

New York(CNN Business) The Dow climbed 435 points Wednesday after the Federal Reserve left interest rates unchanged.

Fed governors unanimously agreed at their first two-day policy-setting meeting of 2019 to keep the federal funds rates, which influences the cost of mortgages, credit cards and other borrowing, at a range of 2.25% to 2.5%.That was largely what Wall Street expected.

The S&P 500 closed 1.6% higher, and the Nasdaq gained 2.2%.

The central bank said in a statement that it "will be patient as it determines what future adjustments to the target range."

Shortly before the announcement, Wharton Finance Professor Jeremy Siegel told CNN Business' Alison Kosik during the "Markets Now" live show that Wall Street would be looking closely at the wording of the Fed's statement.

"In the past year, they've always said there's going to be some gradual rate increases in the future," he said. "Now the market expects them to shift -- not put that in -- and say 'we are now pausing in our rate increases and assessing our increases and how they will affect the economy in 2019.'"

Siegel said during "Markets Now" that he is not concerned about the overall US economy. He sees "no signs that it is entering a permanent slowdown or even a recession."

On Wall Street, Siegel isn't worried about Brexit or another US government shutdown. More troubling, he said, would be an escalation of the US-China trade war.

The Dow also got a boost earlier on Wednesday after Boeing (BA), the largest US exporter, wowed investors with record sales for 2018. It earned more than $100 billion for the first time in its 102-year history, despite trade tensions between the United States and China. The company said it is expecting 2019 to be even better.

Increased deliveries of commercial and military jets buoyed Boeing's results, and sales topped forecasts. Its stock gained about 6.3% Wednesday.

Apple (AAPL) appeared to please investors by delivering news that wasn't as bad as expected. iPhone sales are still sinking, and the company posted its first decline in revenue for a holiday quarter since 2000. There's no end in sight — but much of the pessimism was already priced in: Apple warned investors what to expect earlier this month. Its stock rose more than 5% after earnings were posted Wednesday morning.

CEO Tim Cook attributed the sales decline to foreign exchange rates, a popular battery replacement program, a decrease in carrier smartphone subsidies and "more severe" macroeconomic conditions in China.

Ben Schachter, senior analyst at Macquarie, is an Apple bear. He expects the company's stock price to hit $149 per share. It currently trades around $190.

He told Kosik during "Markets Now" that the company was "quite confident" about its future during a call with investors. But Schachter is still concerned about Apple's pace of innovation, particularly with the iPhone.

Specifically, he thinks the company needs to make its iPhones more useful by adding technology like sensors for health care and fitness.

"If the key drivers are around app stores and the other services business, they will slow," he said. "I just don't know if investors are quite aware that that is to come relatively quickly."

Apple shares closed 3% higher on Wednesday.

Facebook earnings are due after the bell Wednesday. Schachter said he has a positive outlook for Facebook (FB) despite controversy over data breaches and its handling of private user information.

"We've had these horrific headlines for quite some time, and yet the user base has not really left," he said. "In our view, as long as the folks are there using it, then advertisers need to follow and need to be there"

AT&T on Wednesday posted a 15% sales hike, but that fell short of investors' expectations. Its stock sank 4.5%. Net income fell to $4.9 billion, down sharply from $19 billion a year ago — when the company benefited significantly from the corporate tax cut.

There will be an episode of "Markets Now" on Thursday at 12:45 pm ET. Kristen Bitterly Michell, Citi Private Bank's head of capital markets for the Americas, will be joining Kosik to talk about investment strategies in today's volatile times.

CNN Business' "Markets Now" regularly streams live from the New York Stock Exchange every Wednesday at 12:45 p.m. ET. You can watch "Markets Now" at CNN.com/MarketsNow from your desk, phone or tablet.