- Major US stock indexes ended Wednesday at record highs as the Fed outlined its intention to taper asset purchases.
- The economy has made substantial progress in recovering from the COVID pandemic, the Fed said.
All three major equity benchmarks ended at new all-time highs.
The Fed said it would begin tapering asset purchases this month. It has been buying at least $80 billion in Treasurys and $40 billion in mortgage-backed securities every month to help
The economy has made "substantial further progress" toward key recovery goals, leading the Fed to say it will cut down by $10 billion a month purchases for Treasurys and by $5 billion for mortgage bonds.
Here's where US indexes stood at 4:30 p.m. on Wednesday:
- S&P 500: 4,660.57, up 0.65%
- Dow Jones Industrial Average: 36,157.58, up 0.29% (104.95 points)
- Nasdaq Composite: 15,811.58, up 1.04%
"It is true that the Fed will need to raise interest rates next year - possibly more than once - if inflation continues to rise at an elevated pace, but it is also true that the Fed would prefer to leave interest rates at near-zero levels as long as possible to allow the unemployment rate to go lower and the participation rate to go higher," said Chris Zaccarelli, chief investment officer at Independent Advisor Alliance, in a note.
"[So] if there is any indication that inflation is leveling out or the pace of inflation is decreasing next year then they are likely to hold off on raising interest rates," he wrote.
Around the markets, gold shed 0.7% at $1,773 per ounce. The 10-year yield jumped to 1.579%.
Oil prices dropped, with West Texas Intermediate crude down 3.3% at $81.11 per barrel.
Bitcoin slipped 0.4% to $62,943.