Indexes were in the red most of the day but rallied sharply on the Federal Reserve announcement mid afternoon. It is not clear why because the Fed did exactly as everyone expected but that is the hallmark of a bull market. We stated the past few days that the market had worked off its oversold conditions and was ready to go – so today was go. The S&P 500 added 0.77% while the NASDAQ rallied 0.59%.
The Federal Open Market Committee cut its monthly asset purchases by another $10 billion to $35 billion, as expected. Fed Chairman Janet Yellen told a news conference that inflation was expected to move gradually back to the central bank’s 2 percent target.
Here are the longer term charts for the indexes – the NASDAQ is now approaching highs of early March.
The volatility index plunged to the lowest level in over half a decade.
Fedex (FDX) was a big winner after the shipper posted fiscal fourth-quarter earnings that beat estimates.
Amazon.com (AMZN) rose after it introduced a widely rumored smartphone called “Fire” Wednesday afternoon.
Yelp (YELP) continues to work… we mentioned this name when it broke out of a multi month downtrend about 4 weeks ago – it has recently jumped and instead of retracting, held firm…and today had another jump.