Federal Reserve holds still, US stocks soar, gold soars

U.S stocks closed sharply higher on Wednesday, with the Dow and S & P 500 hitting record highs Gold (1371.80, 64.20, 4.91%) soared 4.22% to $1364.60 The Federal Reserve announced that it would not reduce QE temporarily Bernanke said there was no "set schedule" to reduce QE At 16:00 on September 18, EDT (04:00 on September 19, Beijing time), the Dow Jones industrial average rose 147.21 points, or 0.95%, to 15676.94; the NASDAQ [Weibo] composite index rose 37.94 points, or 1.01%, to 3783.64; the standard & Poor's 500 index rose 20.76 points, or 1.22%, to 1725.52 The Dow climbed to 15709.58, while the S & P 500 climbed to 1729.44, both of which set a record After the two-day monetary policy meeting, the Federal Reserve announced that it would not reduce the size of its plan to buy $85 billion a month, and significantly lowered its economic growth forecast for this year and next Previously, the market generally expected that the scale of the reform plan would be reduced by $10 billion At this meeting, the FOMC decided to keep the benchmark interest rate unchanged, which is in line with the broad expectations of the market; at the same time, it continues to be expected that the FOMC is likely to maintain a very low interest rate at least when the unemployment rate remains above 6.5%, the inflation rate is no more than 0.5% higher than the FOMC's long-term target of 2% in the next two years, and the long-term inflation expectation is still very stable The FOMC also kept the size of its asset purchase program unchanged at $85 billion a month, after the market had expected a $10 billion to $15 billion reduction Art Hogan, market strategist at Lazard capital markets, said: "if you look at the economic data since the last Fed policy meeting, you can see that the economic situation is deteriorating So the Fed did something to please the market today " Prior to the FOMC policy statement, Elizabeth Ptacek, senior vice president of KeyBank, also said: "many economic data, including the disappointing real estate data released on Wednesday, do not support the Fed's exit from QE." Adobe Systems (ADBE) led gains in the S & P 500 index after the company announced more than 1 million users of online services Federal Express (FDX) rose 2.7% after the company said its earnings exceeded expectations In terms of economic data, the U.S Department of Commerce announced that 891000 houses will be built in August According to a Bloomberg survey, economists' average expectation is 915000 Economists surveyed by MW on average expect the number to climb to 921000 from 896000 in July "It's clear that the U.S real estate market and the economy are vulnerable to high interest rates, but I don't think that's entirely to blame," said key bank's tasik The credit crunch has not changed It's hard to get a mortgage " Elsewhere, gold futures for December delivery on the New York Mercantile Exchange fell $1.80 to close at $1307.60 an ounce But after the FOMC monetary policy statement was released, gold futures prices soared Crude oil (107.79, - 0.28, - 0.26%) futures rose 2.5% to $108.07 a barrel Federal Reserve policy statement: low inflation or unfavorable economy will not be reduced temporarily QE the Federal Open Market Committee (FOMC) released a monetary policy statement on Wednesday, saying it will wait for more evidence of economic activity and employment market conditions before adjusting the rules of asset purchase plan Low inflation may pose risks to the economy At this meeting, the FOMC decided to keep the benchmark interest rate unchanged, which is in line with the broad expectations of the market; at the same time, it continues to be expected that the FOMC is likely to maintain a very low interest rate at least when the unemployment rate remains above 6.5%, the inflation rate is no more than 0.5% higher than the FOMC's long-term target of 2% in the next two years, and the long-term inflation expectation is still very stable The FOMC also kept the size of its asset purchase program unchanged at $85 billion a month, after the market had expected a $10 billion to $15 billion reduction The Federal Reserve has significantly lowered its economic growth forecast for this year and next According to the economic forecast just released by the Federal Reserve, the Federal Open Market Committee (FOMC) has significantly lowered its economic growth forecast for 2013 and 2014, which provides support for the Federal Reserve to maintain the quantitative easing policy of $85 billion per month At the same time, the Federal Reserve slightly lowered its forecast for unemployment this year and next In its policy statement, the Federal Reserve announced that it would maintain the open-ended quantitative easing (QE) of purchasing US $85 billion of assets every month, the 0-0.25% ultra-low interest rate would remain unchanged when the unemployment rate is higher than 6.5%, the U.S economy has maintained moderate growth since the July meeting, and the labor market situation has further improved in recent months, but the unemployment rate is still high; household spending and fixed investment in enterprises have increased, The real estate market continued to strengthen, but mortgage rates went up further, and fiscal policies restricted economic growth The Federal Reserve's expectation for the middle trend of the real GDP growth rate in 2013 (Note: three highest and lowest values are removed respectively) is 2.0% - 2.3%, which is significantly lower than the expectation of 2.3% - 2.6% in June The expectation for economic growth in 2014 is reduced from 3.0% - 3.5% to 2.9% - 3.1%, and the expectation for economic growth in 2015 is narrowed from 2.9% - 3.6% to 3.0% - 3.5% At the same time, the Federal Reserve's forecast for unemployment this year and next is slightly lower The Federal Reserve's expectation for the unemployment rate in 2013 fell to 7.1% - 7.3%, lower than the 7.2% - 7.3% estimated in June The expectation for the unemployment rate in 2014 fell to 6.4% - 6.8% from 6.5% - 6.8% estimated in June, while the unemployment rate in 2015 rose slightly to 5.9% - 6.2% from 5.8% - 6.2% Strategist: it's not surprising that the Federal Reserve has not reduced QE Todd schoenberger, executive partner of landcolt capital in New York, doesn't think it's surprising He said that given the current macro environment, there is no reason to reduce QE Here are the comments of three investors including schoenberger: Todd schoenberger, executive partner of landcolt capital in New York: "considering the current macro environment, the Fed's decision is not surprising, there is no reason to reduce QE, and it seems that it will not be reduced until December at present." David joy, chief market strategist at merriprise financial in Boston: "it's surprising that the Fed is widely expected to reduce QE I once thought the Fed would wait until October to shrink, but I think I'm in the minority So, given the consensus, it's an accident, but given the information we see, it's not The data is mixed, so the Fed's decision is good " Joseph Trevisani, chief market strategist, worldwidemarkets, New Jersey: "the Fed is unwilling to start to reduce the quantitative easing program, which is almost unanimously expected by the market The Fed officials' views on the near future will cause concern They are willing to take the risk of causing market mismatch in order to keep the economic support unchanged." Bernanke's pigeon talk gold soared and the Fed kept the scale of quantitative easing unchanged At the press conference, Bernanke gave pigeon talk, saying that the Fed's previous forecast on economic growth was too optimistic and commodity prices rose in an all-round way 4.22% to $1364.60 "The Fed's previous forecast for economic growth was too optimistic," Bernanke said at a press conference The Fed believes that the economic headwind runs through 2016 Market expectations do not determine Fed policy " At 4:35 Beijing time, the yield of 10-year US Treasury bonds fell 15 basis points, while S & P rose 1.33%, 4.22% to US $1364.60 Crude oil rose 2.7% to $108.27 a barrel in New York, while silver (23.29, 1.73, 8.02%) surged 5.2% Oil prices in New York rose 2.5% to $108 Crude oil futures in New York rose 2.5% to $108.07 a barrel on Wednesday, mainly because the report showed that last week's decline in U.S crude oil inventories exceeded analysts' expectations, and the Federal Reserve announced to maintain the size of its asset purchase plan European stocks closed 0.4% higher on Wednesday, while investors waited for the Fed's upcoming policy decision to see whether the meeting will start the process of quantitative easing reduction European stocks closed 0.4% higher on Tuesday European equities, represented by the pan European Stoxx 600 index, rose 0.4% to close at 313.28 Among the major European regional indexes, the FTSE 100 index fell 0.2% to 6558.82 France's CAC 40 rose 0.6% to close at 4170.40 Germany's DAX 30 index rose 0.5% to close at 8636.06.