Markets Calm Before Fed Adjourns
High levels of anticipation kept US stock futures even on Wednesday as the central bank of the globe's largest economy prepared for an afternoon policy announcement.
Thursday, June 19, 2014 - 00:00
The bullish trend of one stock index – the S&P – might be in peril after having climbed higher for three consecutive days. While anticipation is strong about the Fed tapering stimulus policy for the fifth straight policy meeting, the road ahead is unclear regarding other policy decisions, such as whether the body will manipulate borrowing costs. Just after 10 a.m. in New York, the Nasdaq edged up 0.4%, a gain of 1.95 points to 4,335.21; the S&P 500 moderately rose 0.14%, a climb of 2.69 points to 1,944.85; and the Dow fell 0.02%, a drop of 3.02 points to 16,811.51. During the past 72 hours of trading, the S&P has climbed 0.6%.
Escalating tension and fighting in Iraq has not been as concerning to analysts, investors, traders and additional market players. But a full-blown civil war in the Middle Eastern nation is a very real possibility, Saudi Arabia officials said on Wednesday, in a message that Saudi Arabia seemed to earmark for Iran and its efforts on Iraq's behalf.
Cost of living pushes up
In addition to the Fed announcing it will taper stimulus by $10 billion, other public announcements on Wednesday afternoon include predictions regarding second quarter jobless data, prospects regarding inflation, the outlook for economic development and additional data, according to Bloomberg.
But borrowing costs are unlikely to move on Wednesday afternoon. Fed policy makers said in the end of the first quarter that interest rates would push to 1% by the end of next year. Presently standing at 0.25%, interest rates might climb to 2.25% by the end of 2016, the body said in March.
The S&P touched record-high levels earlier this month on repeat occasions, with the most recent one being on June 9. Those gains are a significant component of the metric 7% lift since April 11. That low is linked with frigid weather permeating much of the US, which proved to be taxing against the national economy.
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