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Inside the Market

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At the close: Feeling better-Fed Add to ...

North American equity markets closed mixed Wednesday, as investors were encouraged by an improving economic outlook from the U.S. Federal Reserve Board, but weak commodity markets kept Canadian stocks under water.

The S&P/TSX composite index closed down 17.08 points, or 0.2 per cent, at 11,344.11. In New York, the Dow Jones industrial average rose 41.87 points or 0.4 per cent to 10,236.16, while the S&P 500 gained 5.33 points or 0.5 per cent to 1,097.50.

The technology-heavy Nasdaq composite index closed up 17.68 points, or 0.9 per cent, at 2,221.41, after investors gave a qualified vote of approval to Apple Inc.'s splashy iPad tablet unveiling.

In its mid-afternoon monetary-policy statement, the Fed held interest rates steady, as was widely expected. However, it upgraded its outlook on the pace of the economic recovery to "moderate" from "weak," marking a shift in the highly influential U.S. central bank's tone on the economy.

Earlier in the afternoon, Apple unveiled its hotly anticipated entry to the tablet device market, tabbed the iPad. While the name left many critics flat and the announcement told technology watchers little that hadn't already been leaked and/or rumoured before the unveiling, the iPad's suggested retail price - starting at $499 (U.S.) - was considerably lower than many experts had anticipated.

Apple's shares, which initially tumbled in the minutes after the announcement, closed up 1 per cent, contributing substantially to the Nasdaq composite's gains.

Technology stocks in general had a strong day after Apple's announcement. The S&P/TSX's technology subindex surged 3.1 per cent, thanks to a 4-per-cent advance of sector heavyweight Research In Motion - a major competitor of Apple in the handheld-device market.

Over all, the TSX's 10 industry subindexes were evenly split between gainers and losers. The downside was led by the materials group, which slumped 1.6 per cent amid lower gold and base-metal prices. The heavily weighted energy group fell 0.6 per cent as the price of oil continued its retreat.

Crude lost $1.08 (U.S.) to $73.63 a barrel in New York, a six-week low. Gold fell $11.90 to $1,087.60 an ounce.

The Canadian dollar closed down 0.17 of a cent at 93.93 cents (U.S.).

After the close, Canadian tech company Celestica Inc. released earnings that topped analysts' estimates. Thursday will feature several big Canadian earnings reports, with Potash Corp. of Saskatchewan, Canadian Pacific Railway and Canadian Oil Sands Trust all slated to report.

Investors will be watching U.S. President Barack Obama's state of the union address Wednesday night, for insight into where the White House's priorities, budget and economic strategies stand for the coming year. On Thursday morning, the U.S. markets will also see the weekly U.S. jobless-claims numbers and December durable-goods orders.

Thursday is also a huge day for U.S. earnings reports, including those of four Dow components - AT&T, 3M Co., Procter & Gamble and Microsoft.

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