--- title: "Fed holds rates, stocks rise a third day as long yields climb" url: "https://etf.net/news/fed-holds-rates-stocks-rise-2026-10-28" published_at: "2026-10-28T21:10:27.474Z" updated_at: "2026-10-28T22:33:27.687Z" byline: "ETF.net Research" --- # Fed holds rates, stocks rise a third day as long yields climb Two Fed officials vote for a quarter-point increase. Technology leads stocks higher for third rally in a row. and Alphabet falls after hours. By ETF.net Research. Published Oct 28, 2026. Chipmakers lifted the market higher on Wednesday as the Federal Reserve held its benchmark rate at 3.75% to 4%, six weeks after its first increase since 2023. Two officials voted for another quarter-point hike. Long yields climbed on the news. Fed funds futures, which traders use to bet on the Fed’s next move, still put the odds of a December increase above 80%. Stocks climbed for a third straight day: The S&P 500 rose **0.28%** to 7,743.98, the Nasdaq Composite added **0.27%** to 26,549.85 and the Dow Jones Industrial Average gained 97.53 points, or **0.19%**, to 52,475.10. Long-dated Treasurys fell, pushing the 10-year yield **to 5.05%**, while two-year yields declined, steepening the yield curve. ## Two officials wanted a rate increase The Federal Open Market Committee, the Fed’s rate-setting panel, voted 10-2 to keep the target range for the federal funds rate, the rate banks charge one another for overnight loans, at 3.75% to 4%. Fed Governor Lisa Cook and Cleveland Fed President Beth Hammack voted to raise it by a quarter percentage point. It was Cook’s first dissent since she joined the Fed’s board in 2022, [CNN reported](https://www.cnn.com/2026/10/28/business/live-news/federal-reserve-interest-rate-october). Hammack also voted for a hike in July. The Fed statement said economic activity is expanding at a “strong pace,” an upgrade from “solid” in September, and that inflation “remains elevated.” It added that the committee wants more information before deciding what policy will return inflation to its 2% goal, and it ends with a pledge: “The Committee will deliver price stability.” At his news conference, Fed Chairman Kevin Warsh said most officials believe September’s increase, the Fed’s “monetary medicine,” is starting to work, though the committee has reached no firm conclusions. Financial conditions are tighter overall, he said, but he was “unwilling and unable to call them tight.” The Fed also said it will hold fewer policy meetings starting in 2027, Reuters reported. ## Oil prices climb West Texas Intermediate crude was up 2.1% at $101.99 as of 4:51 p.m. ET. Brent, the international benchmark, traded near $115 a barrel. Reuters tied the day's rise to a claim by Yemen's Houthis that they had hit Saudi Arabia's largest refinery, a 550,000-barrel-a-day plant. Saudi authorities had not confirmed the attack. ## Canada raises interest rates While the U.S. Federal Reserve held rates steady, Canada tightened its monetary policy, [raising](https://www.bankofcanada.ca/2026/10/fad-press-release-2026-10-28/) its overnight rate by 25 basis points to 2.5%. It did so to reduce the risk of high energy prices spreading into other prices. Canadian inflation has been around 3% since April, the Bank said, and is expected to rise to about 3.5% by year-end. ## Semiconductor stocks led markets higher State Street SPDR S&P 500 ETF SPY rose **0.3%**, a third straight gain. State Street Technology Select Sector SPDR ETF XLK rose 0.8%, a fourth straight gain, and was the strongest of the 11 sector funds. Chart: Technology led the 11 sectors; utilities fell the most VanEck Semiconductor ETF SMH rose 1.7%. In a group of 25 semiconductor funds, every one rose, by a median 2.5%. SK hynix shares closed 10.9% higher in Seoul on Wednesday, in a session that ended before New York opened, after the company reported record third-quarter revenue of 104.6 trillion won and operating profit of 83.3 trillion won, or about $62 billion. The company set its 2026 shareholder returns, including dividends and buybacks, at about 100 trillion won, or about $75 billion. Its U.S.-listed shares rose 13%, [CNBC reported](https://www.cnbc.com/2026/10/28/sk-hynix-third-quarter-profit.html). All 25 semiconductor ETFs that ETF.net tracks rose, with a median gain of 2.5%. ## Yield curve steepens Short-term Treasury yields fell and Long-term Treasury yields climbed as investors priced in higher inflation risks due to a perceived dovish fed. Every published Treasury yield from one month through two years fell, and every yield from five years and longer rose. Chart: Front-end yields fell; five years and out rose The two-year yield fell 3 basis points to 4.67%. The 10-year yield finished at **5.05%**, up 6 basis points from 4.99% on Tuesday, and the 30-year rose 7 basis points to 5.37%. The gap between the 10-year and the two-year widened by 9 basis points, to 38 basis points. A higher long-term yield means a higher costs for new long-term Treasury borrowing, and a lower price on bonds already issued. iShares 20+ Year Treasury Bond ETF TLT fell 0.8%. Chart: XLK climbed four sessions as TLT slipped Wednesday Six of the 11 sector funds rose during Wednesday's trading: State Street Technology Select Sector SPDR ETF (XLK) rose 0.8%, its fourth straight gain and the best of the 11 sector funds. The two biggest losing sector funds were State Street Utilities Select Sector SPDR ETF (XLU) fell 0.8% and State Street Real Estate Select Sector SPDR ETF (XLRE'), which fell 0.7%. ## After the bell: Alphabet falls, Microsoft rises Alphabet fell about 9% in extended trading after its third-quarter search revenue and total revenue missed analysts’ estimates, CNBC reported. Microsoft rose about 2% after beating estimates for its fiscal first quarter, and Fortinet fell 25%. Alphabet is in the communication services sector, so Communication Services Select Sector SPDR (XLC) and broad funds such as SPY hold it; Microsoft is in the technology sector that XLK tracks. The Fed and the Bank of Canada both announce their next rate decisions on Dec. 9. Source: etf.net, https://etf.net/news/fed-holds-rates-stocks-rise-2026-10-28. Please cite the page URL.