By Oliver Gray
Investing.com - U.S. futures ticked higher in overnight trade on Wednesday, as market participants reacted positively to the Federal Reserve’s commentary, as policymakers noted that they would soon start to wind back spending on asset purchases, initiated during the pandemic's height to help the economy.
During regular trade on Wednesday, the Dow Jones Industrial Average gained 338.48 points or 1% to 34258.33 for its first positive session in five, the S&P 500 advanced 41.45 points or 0.95% to 4395.63, also snapping a four-day losing streak. The NASDAQ Composite added 150.45 points or 1.02% to 14896.85.
In policy news, policymakers in the Federal Open Market Committee indicated that will start pulling back on pandemic-era stimulus the, but no specific indication was given as to when that might happen. The FOMC’s post-meeting statement noted that “If progress continues broadly as expected, the Committee judges that a moderation in the pace of asset purchases may soon be warranted.”
Meantime, Fed Chair Jerome Powell noted at the post-meeting press conference that “While no decisions were made, participants generally viewed that so long as the recovery remains on track, a gradual tapering process that concludes around the middle of next year is likely to be appropriate.” Powell also noted that “For inflation, we appear to have achieved more than significant progress, substantial further progress. That part of the test is achieved in my view and the view of many others.”
Projections signaled that FOMC members see inflation stronger than projections in June. Core inflation is projected to increase 3.7% this year, compared with the 3% forecast the last time members gave their expectations.
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