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Markets reacted positively to Fed Chair Jerome Powell’s statement Wednesday.
Mark Wilson/Getty Images
Wall Street was set for an upbeat start Thursday while global stocks pushed higher, as investors seemed to shake aside concerns of a September slump after a key meeting Wednesday of the U.S. Federal Reserve.
Futures for the
Dow Jones Industrial Average
indicated an open around 190 points higher, after the index rallied 338 points Wednesday to close at 34.258. Futures for the
S&P 500
and
Nasdaq
pointed to a similar higher open after U.S. stocks made headway in reversing some three weeks of declines across September.
Overseas, Hong Kong’s
Hang Seng Index
rose 1.1% as it returned from a holiday, while the pan-European
Stoxx 600
lifted 0.9%.
Investors reacted positively to Wednesday’s meeting of the Fed, where the central bank said that the slowing, or tapering, of its Covid-19 pandemic-era bond buying program—which adds liquidity to markets—“may soon be warranted.” The Fed also indicated that interest rate hikes could be coming in 2022.
“The Fed struck a positive tone, acknowledging that the economy is strong enough to stand on its own two feet and the central bank can begin removing the monetary stimulus that they’ve been providing since the beginning of the Covid crisis,” said Chris Zaccarelli, the chief investment officer at asset manager Independent Advisor Alliance.
“We weren’t surprised to see the Fed tee up November as the likely beginning of tapering as they have previously highlighted the higher-than-expected inflation numbers and were only waiting for the job market to improve before beginning to reduce their bond purchases,” Zaccarelli added.
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