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* Fed cuts rates by 25 basis points
* GE gains on profit beat, cash flow forecast
* U.S. GDP growth slows less than expected in Q3
* Dow up 0.05%, S&P 500 down 0.04%, Nasdaq down 0.04% (Updates with Fed statement, changes byline)
By Chuck Mikolajczak
Oct 30 (Reuters) - U.S. stocks were little changed on Wednesday, rebounding after a brief move lower in choppy trade on the heels of the policy statement by the U.S. Federal Reserve that cut interest rates by a quarter of a percentage point.
The Fed cut lowered its policy rate to a target range between 1.50% and 1.75%, but dropped a previous reference in its statement to “act as appropriate” to support the economic expansion, which could signal the Fed may hold off on future rate cuts.
“The market certainly was expecting the 25-basis point rate cut. That is what we got,” said Michael Arone, Chief Investment Strategist at State Street Global Advisors in Boston. “The reaction of the markets today and rates suggest investors are concluding, rightly or wrongly, that the Fed is close to being done with their cuts.”
Hopes of a rate cut and recent optimism around the trade talks had helped lift the benchmark S&P 500 to record intraday highs in the previous two sessions.
The Dow Jones Industrial Average rose 12.73 points, or 0.05%, to 27,084.15, the S&P 500 lost 1.23 points, or 0.04%, to 3,035.66 and the Nasdaq Composite dropped 3.71 points, or 0.04%, to 8,273.14.
The interest-rate sensitive banking sub-sector pared losses after the statement, but was still down 0.69%. Utilities, up 0.43%, was the best performing while the energy sector lagged, down 2.12%.
Investors also dealt with the latest round of corporate earnings. Shares of General Electric Co jumped 9.20% after the industrial conglomerate beat quarterly profit estimates and raised its cash forecast for the year.
Yum Brands Inc shed 7.04% and was among the top decliners on the benchmark index as the KFC owner missed quarterly profit expectations.
U.S. economic growth slowed less than expected in the third quarter, a Commerce Department report showed, as declining business investment was offset by resilient consumer spending and a rebound in exports, further allaying financial market fears of a recession.
Other data showed a modest acceleration in private sector job growth, boosted by gains in the service sector, according to the ADP National Employment Report. The data comes ahead of Friday’s payrolls report.
About 74.1% of the 278 S&P 500 companies that have reported so far have beaten profit estimates, according to Refinitiv data.
However, profit growth forecasts for the next four quarters have been revised lower, even as expectations for the decline in third quarter earnings has shrunk to 1.6%, compared with a 2.2% fall at the start of the month.
Shares of tech heavyweight Apple Inc and social media giant Facebook Inc fell ahead of their earnings reports due after the bell. They were the biggest drags on the Nasdaq.
Buoying the Dow was a 2.47% rise in shares of Johnson & Johnson. The company said 15 new tests found no asbestos in a bottle of baby powder that the U.S. Food and Drug Administration says tested positive for trace amounts of asbestos. FDA said it stands by its finding.
Mattel Inc surged nearly 12.55% after the U.S. toymaker reported a surprise jump in quarterly revenue.
Declining issues outnumbered advancing ones on the NYSE by a 1.35-to-1 ratio; on Nasdaq, a 1.42-to-1 ratio favored decliners.
The S&P 500 posted 11 new 52-week highs and 4 new lows; the Nasdaq Composite recorded 50 new highs and 64 new lows.
Reporting by Chuck Mikolajczak Editing by Nick Zieminski