Dow, S&P 500 hit new highs on Fed’s ‘Taper Lite’

Dow, S&P 500 hit new highs on Fed's 'Taper Lite'

U.S. stocks soared to new highs Wednesday even though the Federal Reserve announced that it would begin gradually dialing back on its market-friendly bond-buying program in January, a decision that marks the start of a long-awaited shift back to more normalized monetary policy.

The Dow Jones industrial average surged almost 300 points to a record close after the Fed decision, as markets were soothed by the Fed’s dovish comments overall, which suggests a still-easy Fed going forward.

The Dow rose 292.71 points, or 1.8%, to 16,167.97. It blew past its previous closing high of 16,097.33, set Nov. 27.

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In a statement explaining its decision, the Fed said it “sees improvement in economic activity and labor market conditions” that are consistent with growing underlying strength in the broader economy.” It also said it would continue to monitor incoming economic data and continue its asset purchases in “until the outlook for the labor market has improved substantially.”

Source: USA Today

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