US stock market closes with records after Fed meeting

By Ovunc Kutlu

ANKARA (AA) - Major US indices closed with record highs Wednesday after the Federal Reserve announced it will start tapering late this month as expected.

Despite hovering in negative territory earlier, the Dow Jones added 104 points, or 0.29%, to end the day at 36,127 after hitting an all-time high of 36,178.51 before the closing bell.

The S&P 500 rose almost 30 points, or 0.65%, to 4,660 after posting a new record of 4,663.46 during the session.

The Nasdaq jumped 161 points, or 1.04%, to 15,811. The tech-heavy index hit a fresh all-time high of 15,821.57 during trading hours.

The Fed kept its benchmark interest rate unchanged and said tapering, the process of reducing its monthly asset purchases, will start later this month, in line with market expectations.

Chair Jerome Powell said afterward the central bank’s two-day meeting that it will ensure its monetary policy would address disruptions caused by the coronavirus pandemic and the reopening of the US economy.

Powell was also dovish about the possibility of a rate hike. "We don't think it's a good time to raise interest rates because we want to see the labor market heal further,” he said. “We have very good reason to think that that will happen as the delta variant declines."

Amid the dovish stance, the VIX volatility index, known as the fear index, plummeted 5.3% to 15.17 and the US dollar index fell 0.22% to 93.88.

The yield on 10-year US Treasury notes, however, was up 3.1% to 1.595%.

Oil prices lost more than 4% before the critical meeting of OPEC and its allies Thursday. International benchmark Brent crude was trading at $81.29, down 4.05%, while US benchmark West Texas Intermediate fell 4.8% to $79.89.

Precious metals were mixed with gold losing 0.85% to $1,772 per ounce and silver flat at $23.54.