Stocks Rally on Fed Announcement
After turning in a lackluster performance
throughout much of the trading session, the U.S. stock markets have shown a
notable upward move following the release of the Federal Reserve’s announcement
of its decision to leave interest rates unchanged line.
The Fed announced that it decided to keep
its target for the federal funds rate at 5.25 percent for the fifth consecutive
meeting. While the decision to leave rates unchanged was widely expected, some
traders have responded positively to the accompanying statement.
In the statement, the Fed said that recent
indicators have suggested somewhat firmer economic growth, with some tentative
signs of stabilization in the housing market. The Fed added that readings on
core inflation have improved modestly in recent months.
The price of oil moved sharply higher over
the course of the trading day on Wednesday, extending the strong upward move
that was seen in the previous session. After ending Tuesday’s trading up nearly
$3 a barrel, crude for March delivery closed up $1.17 at $58.14 a barrel.
The price of gold showed a strong upward
move during trading on Wednesday, benefiting from an upturn by the price of oil.
After ending the previous session up a little more than $1 an ounce, gold for
April delivery closed up $7.70 at $657.90 an ounce.
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Darren Wong
Associate Editor
darrenw@tradingmarkets.com