Dow Jones rallies 519 points after Fed hikes official interest rates

NEW YORK, New York – U.S. stocks zoomed higher Wednesday as the U.S. dollar dived following the first increase in U.S. official interest rates in 3 years.

As expected, the U.S. Federal Reserve increased rates by 25 basis points on Wednesday.

“The Fed did not rock the boat. They increased rates like expected, they did lower GDP forecast this year, and upgraded inflation expectations but none of that was a surprise,” Ryan Detrick, chief market strategist for LPL Financial in North Carolina told Reuters Wednesday.

“It was nice to see some follow through of yesterday’s big gains. This is the first time we’ve had two big up days since the war started in Ukraine,” he said. “With the Fed not rocking the boat, buyers stepped in to find values.”

Technology stocks were the biggest gainers Wednesday. The Nasdaq Composite rallied 487.93 points or 3.77% to 13,436.55.

The Dow Jones Industrial Average jumped 518.76 points or 1.55% to 34,063.10.

The Standard and Poor’s 500 advanced 95.43 points or 2.24% to 4,357.86.

The U.S. dollar fell sharply on the widely-expected Fed decision but clawed back some losses before the close Wednesday. The greenback ended mixed.

The euro edged up to 1.1016. The British pound was sharply higher at 1.3138. The Japanese yen weakened to 118.90. The Swiss franc was also friendless at 0.9423.

The Canadian dollar was little changed at 1.2688, as was the Australian dollar at 0.7288. The New Zealand dollar rose sharply, settling around 0.6831, after hitting an earlier intra-day high of 0.6844.

Overseas, the Dax in Germany soared 3.76 percent. The CAC 40 in Paris, France climbed 3.68 percent. London’s FTSE 100 added 1,62 percent.

In Asia, the benchmark Hang Seng index rocketed up a 1,672.42 points or 9.08 percent gain to 20,087.50.

China’s Shanghai Composite rallied 106.75 points or 3.48 percent to 3,170.71.

In Japan, the Nikkei 225 stacked up 415.53 points or 1.64 percent to 25,762.01.

The Australian All Ordinaries gained 72.60 points or 0.99 percent to close Wednesday at 7,428.70.

New Zealand stocks shrugged off the record 24 Covid-19 deaths recorded overnight. Across the country cases in the prior 24 hours exceeded 19,000. New Zealand has been largely isolated from the pandemic but is making up lost ground in a hurry.

Regardless the S&P/NZX 50 rose 72.38 points or 0.61 percent to 11,874.11.

In Seoul, South Korea, the Kospi Composite rose 37.70 points or 1.44 percent to 2,659.23.

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