Wall St. closes sharply higher on Fed-driven late-afternoon rally



by   |  VIEW 1624

Wall St. closes sharply higher on Fed-driven late-afternoon rally

On Wednesday, all three key indices of Wall St. had skyrocketed following a late-afternoon rally as the US Federal Reserve had said in a statement following its two-day long December policy meet that the US Central Bank would break off its pandemic-era bond repurchase program in March, illustrating a roaring US economy which has reportedly been closing in on a maximum employment.

On top of that, followed by its December 14-15 policy meet, the US Federal Reserve had hinted that its inflation target had been met, while an earlier-than-anticipated wind-up of its bond taper program had cemented ways for three rate hikes in 2022, however, Fed Chair Powell was quoted saying in a post-meet press conference that the timing of a rate-hike would largely depend on job gains in US labor market.

Aside from that, Powell also underscored that a scorching inflation-surge across the United States appeared to have become a major headwind in achieving maximum employment. Besides, despite a feeble opening of the day, all three key indices of Wall Street gained across the board after the Fed Chair Jerome Powell had voiced an upscaled optimism over US economic recovery and expressed a strong intent to raise the Central Bank’s overnight lending cost in a bid to put the kibosh on a swathe of soaring inflation indicators.

Wall St. posts large gains after Fed policy meet

Citing statistics, in the day’s Wall St. closing bell, trade-sensitive Dow added 1.08 per cent to 35,927.43 and benchmark S&P 500 jumped 1.63 per cent to 4,709.85, while tech-heavy Nasdaq took a giant leapfrog of 2.15 per cent to wind down the session at 15,565.58.

Meanwhile, a senior portfolio manager at Globalt Investment in Atlanta, Tom Martin said, “What the markets are saying is, because the Fed is increasing their taper, maybe they feel inflation is under control. They did what was expected.

It’s going to add to the credibility for the Fed and that will be - on balance - neutral to positive for the markets”.