Dow gains 140: Stocks rally ahead of Fed decision
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When it comes to the Fed and interest rates, what they say after their rate decision Thursday could be the key to how the market reacts. Adam Shell with America's Markets.
Stocks rallied Wednesday afternoon, the Dow gaining 140 on the day, after the Federal Reserve kicked off its long-awaited 2-day policy meeting on interest rates.
In one of the most important Fed meetings in recent times, economists are divided on whether the Fed will pull the trigger and start raising interest rates. Some economists say it’s time to start gradually raising rates for the first time in nearly a decade given that the U.S. job market has more or less recovered. Others argue rates should remain on hold amid global stock market turmoil and China’s slowdown, among other factors.
The uncertainty didn’t hurt the stock market. The Dow Jones industrial average gained 0.8%, adding to the previous day’s strong rally.
The Standard & Poor’s 500 index climbed 0.9% and the Nasdaq composite index finished 0.6% higher. The rally left the S&P halfway between its high and low this year, down 6.6% from its May 21 record close and 6.6% above its 2015 low set August 25.
Global markets were higher Wednesday after an unexpected rally on Wall Street saw the Dow jump more than 200 points ahead of the Fed decision on whether to raise interest rates.
Japan’s Nikkei 225 index gained 0.8% to close at 18,171.60 while Hong Kong’s Hang Seng index rose 2.4%. The Shanghai composite index surged 4.9%, closing at 3,152.26.
European shares were also higher, with Germany’s DAX index rising 0.4%, France’s CAC 40 up 1.7% and Britain’s FTSE 100 gaining 1.5%.
Contributing: Associated Press
USA TODAY contributor Jeff Reeves discusses what the up coming federal rates change means to investors. USA TODAY
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