4:05pm: US stocks rally as Federal Reserve approves plans to begin tapering
Investors reacted positively to the news that the US Federal Reserve had approved plans to start a tapering its pandemic-era asset purchases.
The S&P 500, Dow and Nasdaq each rose to record levels yet again.
At the close, the S&P 500 gained 30 points to finish at 4,661 points, a 0.65% gain, while the Dow Jones added 105 points to reach 36,158 for a 0.29% lift. The Nasdaq finished at 15,812 points, a 162-point or 1.04% increase.
2.20pm: Tapering a reality
US stocks rallied in mid-afternoon trading after the Federal Reserve approved plans to begin scaling back its bond-buying stimulus program this month and end it by June 2022, much as markets had anticipated.
After the news, the Dow Jones Industrial Average recovered from earlier triple-digit falls to be down 43 points, or 0.1% at 36,009, while the broader S&P 500 index pushed into positive territory adding 0.3%. However, the tech-laden Nasdaq Composite Index lost some of its earlier contrarian gains to add just 0.1%.
In a statement following the end of the latest two-day Federal Reserve Monetary Policy Committee (FOMC) meeting on Wednesday, officials at the US central bank said they still anticipated elevated inflation would fall because high readings are “largely reflecting factors that are expected to be transitory.”
“Supply and demand imbalances related to the pandemic and the reopening of the economy have contributed to sizable price increases in some sectors,” the statement added.
The Fed cut its short-term benchmark rate to near zero when the coronavirus pandemic hit the US economy in March 2020. It held rates at that level on Wednesday.
Commenting on the latest Fed decision, Naeem Aslam, chief market analyst at Avatrade said: "Tapering is here and the Fed is going to go easy on the asset purchase paddle. Although the message was very well telegraphed but market players are still digesting the message and this has brough whipsaw moves for the gold price. The focus for traders will be the US NFP data which is the major event for the markets."
1.00pm: US stock indexes waver
All eyes are on the Federal Reserve, which is set to conclude its two-day meeting later in the day. Officials are expected to announce the beginning of the end of their $120 billion-a-month bond-buying program but keep rates unchanged, despite growing disquiet about inflation.
The Dow Jones Industrial Average edged down 119 points, or 0.3%, while the technology-heavy Nasdaq Composite Index rose around 0.9%. The S&P 500 dipped 0.1%.
Meanwhile, below the surface a frenzy broke out among meme stocks popular with individual investors on Reddit’s WallStreetBets page. Bed Bath & Beyond surged 32% to $424 in afternoon trade on the Nasdaq after it announced a partnership with grocery chain Kroger, and was among the most discussed companies on the Reddit forum.
11.45am: Proactive North America headlines:
American Resources upgrades its processing facility at Perry County Resources complex
Vuzix receives Smart Glasses follow-on order to support another Fortune 50 customer
Nextleaf Solutions launches highest potency CBD oil in Canada
Fidelity Minerals says permitting has begun at its 50%-owned Core Las Huaquillas project in Peru
Predictmedix announces launch of ThuraPass Safe Entry Program for COVID-19 screening
Coinsilium Group confirms significant boost to crypto holdings
Altamira Gold intersects multiple zones of disseminated sulphide mineralization at the Mutum target on Apiacas project
Kenorland Minerals closes $5.2M strategic investment by Sumitomo Metal Mining Canada
Altiplano Metals reports assay results from ongoing exploration program at Farellon copper-gold mine in Chile
Pacific Empire Minerals stakes 5,441 hectares next to Northwest Copper's Kwanika property in British Columbia
Infield Minerals unveils encouraging findings from ground geophysical survey at its Desperado project in Nevada
Kootenay Silver reveals second-highest intercept to date at its Columba silver project in Mexico
Audacious announces strategic partnership with Thailand's Golden Triangle Health, driving entry into Asia-Pacific cannabis market
ESE Entertainment says its Digital Motorsports brand to host first annual Digital Motorsports World Cup
Ayurcann rolls out across Canada with Medical Cannabis Practitioners
Viscount Mining reveals new rock chip samples of over 100 grams per ton silver from its Silver Cliff property in Colorado
PyroGenesis Canada expects positive net income for 3Q and record $22M revenue for nine months
Naturally Splendid installs new packaging system to boost NATERA plant-based product distribution
Marble secures licensing agreement with Debtsadhu for its proprietary Marble Connect API
NEXE completes successful factory acceptance test for proprietary high-speed dosing machine
Royal Road Minerals announces new director appointments and establishment of advisory board
Quaterra Resources announces appointment of David Harvey as its vice president of Exploration
Cloud DX (TSX-V:CDX, OTCQB:CDXFF) says study shows its winning AcuScreen application can help address global tuberculosis crisis
Cabral Gold says drilling on the MG gold deposit has extended the main mineralized zone at depth
Soma Gold eyeing expansion of resource and mine life at Cordero project as it posts final exploration drill results
Tocvan Ventures proceeds with non-brokered private placement for gross proceeds of up to C$1.2 million
Mydecine files for patent to cover technology for developing customized doses, microdoses of traditional medicines
Revive Therapeutics enters into research collaboration agreement for development of psilocybin microneedle patc
Spyder Cannabis receives Retail Store Authorization for Offside Cannabis location
CytoDyn reveals ‘very strong’ updated results for cancer patients receiving its flagship drug leronlimab
Amryt Pharma third-quarter revenue up over 14% on soaring metreleptin sales
Cypress Development welcomes extension to August, 2022 for key water permit in Nevada
Valeo Pharma obtains public reimbursement for innovative asthma therapies Enerzair and Atectura
Falcon Gold hails exploration results from Spitfire-Sunny Boy gold project in British Columbia
Fortitude Gold (OTCQB:FTCO) reports 3Q net income of $4.6M and says it’s on track to meet annual production guidance
BioPorto (NASDAQ COPENHAG:BIOPOR) extends enrollment for clinical trial on moderate to severe acute kidney injury into first half of 2022
Psyched Wellness (CSE:PSYC, OTCQB:PSYCF) says Health Canada approves its request for adding Amanita muscaria mushrooms to Natural Health Products
9.36am: US shares start lower
US stocks opened in the red on Wednesday as markets digested strong ADP jobs figures and awaited a Fed decision on tapering stimulus measures.
The Dow Jones Industrial Average shed over 73 points at 35,979 in early deals in New York. The S&P 500 lost around four points at 4,626, while the tech heavy Nasdaq exchange dropped around eight at 15,641.
October’s ADP private employment report showed that private businesses hired 571,000 workers last month, beating expectations for 400,000.
This report potentially paves the way for a strong US non-farms jobs report on Friday, suggested Victoria Scholar, head of investment at interactive investor.
"Although the Fed will no doubt be paying close attention to this week’s labour market figures, a single data point is unlikely to change the central bank’s course of action, with the likelihood remaining for the Fed to cut its Treasury bond buying by $10bn per month and downsize its mortgage-backed security purchases by $5bn a month, starting this month and winding up the entire stimulus programme by June," she said in a note.
6.30am: US stocks seen opening mixed
US stocks are expected to open mixed on Wednesday after hitting new highs in the previous session as investors await the Federal Reserve’s policy decision, due at 2.00pm Eastern Time.
Futures for the Dow Jones Industrial Average declined 0.09% in pre-market trading, while the broader S&P 500 index shed 0.05% and those for the tech-heavy Nasdaq 100 gained 0.12%.
Stocks closed higher on Tuesday on continuing strong corporate earnings. The Dow rose 0.39% to 36,053, while the S&P 500 gained 0.37% to 4,630 and the Nasdaq advanced 0.34% to 15,649.
The FOMC is expected to announce a tapering in its asset purchases when it wraps up its two-day policy meeting today, a move that has already been telegraphed to the market. Investors will be looking for clues on whether the end of quantitative easing signals the start of higher interest rates.
“Wall Street closed at a new record high for a fourth-straight session as earnings continue to underpin confidence in fundamentals,” said Neil Wilson, chief market analyst at markets.com.
“It appears that fears about inflation eroding margins are so far unfounded. Whilst markets may have concerns about the Fed’s tapering and eventual tightening, these seem to have been well telegraphed thus far with the Fed chasing to catch up with bond markets and not the other way around.”