Trading was jumbled after a highly anticipated speech from Fed Chair Jerome Powell, where he essentially said the Fed may continue to pump aid into the economy even if inflation rises above its target level of 2%, as long as it had been weak before then. Prices for stocks, bonds and gold all made several U-turns in the minutes after Powell began talking.
The benchmark index is coming off a five-day winning streak and has returned to a record level after the immense support of the Fed helped halt its free-fall earlier this year and erase its pandemic losses. Low rates often act like steroids for stocks, allowing their prices to rise faster than corporate profits.
Treasury yields fell immediately after Powell began talking, but then started bouncing up and down. The yield of the 10-year Treasury was at 0.71%, up from 0.68% late Wednesday. Earlier in the morning, a report showed the pace of layoffs sweeping the country remains incredibly high but may be slowing. A little more than 1 million U.S. workers applied for unemployment benefits last week, which was a slight dip from the slightly more than 1.1 million the prior week.
Stocks of companies that sorely need people feeling comfortable enough with the pandemic to get back to "normal" life were also strong. Norwegian Cruise Line was up 6.4%, Live Nation Entertainment rose 6.2% and United Airlines rallied 6.2%.
Various markets had already returned to their record levels a while back. Didn't youpeople read all about it in the mainstream media?
But the stock market being at all time highs means that the economy is doing so well, why would they keep rates low...
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