In a recent spate of events, the US Stock prices swayed rather wildly, and led to a downfall after the FOMC meet. The high volatility was a result of the Federal Reserve’s November policy release after the meet. Subsequently, the Dow Jones Industrial average fell at least 79.75 points, or 0.24%. Likewise, all other major stocks opened well, but their values turned negative, the results show a resilient labour market. The Central Bank has already taken an aggressive action model to reign the inflation, and these latest developments only add to the woes.
Hike in interest rates
Tuesday basically was the start of the Federal Reserves’ November meeting. Moreover, it is expected that the results would be somewhere around a hike of 75 basis points. The stocks closed at lower indices, due to the Fed rate decision. These potential rate changes can impact the stockholders and traders to a huge extent. The first-rate hikes as released by the Federal Reserve, will likely start showing their huge impact on the economy in the days to come. For the unversed, the FOMC mainly refers to the Federal Open Market Committee, which decides the direction of the monetary policy.
Despite this drop in indices, the markets according to the analysts, will continue to show some positive changes. However, some bouts of volatility cannot be ruled out. To be precise, the Sensex crossed the 61,000 mark and the Nifty closed at 18,000. Thus, the fall of indices in the US market is going to impact investors across the globe. All the sectors, except the IT and energy zones, were basically trading in plus while gaining 1.28% on the pharma index. A rise of 0.69% on the metal index is also seen. Thus, this has acted as a cue to the central banks located across the globe. Now, all hopes are pinned on Fed chief, Jerome Powell. Thus, it is suggested by experts, that the investors must stick to their ‘buy on dips’ approach all this while.
Thus, everyone is keeping their fingers crossed and expecting the best, as a result of the FMOC outcomes.