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Markets React Negatively To Fed Meeting Results

Published 03/20/2014, 07:49 AM
Updated 03/09/2019, 08:30 AM

Yesterday we witnessed a rather interesting and emotional day, filled with important events. At present, the best idea is to try to digest all the news in order to make correct decisions.

Problems between Ukraine and Russia still remain on the agenda, but nevertheless are developing rather quietly and are not having a significant effect on the markets as of yet. The acting president of Ukraine, Oleksandr Turchynov, presented the parliament a declaration about the "Fight for Liberation of Ukraine". According to the document, "Crimea was, is and will be a part of Ukraine". Also it was stated that: "The Ukrainian people will never, under no circumstances, stop the fight for liberation of Crimea from invaders, as heavy and as long as it shall be".

The government of Ukraine made the decision to begin to exit from the CIS. Besides that, the Ministry of Foreign Affairs of Ukraine received an order to enter a visa regime with the Russian Federation. Meanwhile, news regarding further sanctions concerning Russia continue to arrive. The leadership of Switzerland suspended negotiations on free trade zone creation with the Customs Union (CU) of Russia, Belarus and Kazakhstan. The government of Germany stopped cooperation in the military sphere between the German defence technology producer 'Rheinmetall AG' and Russia.

One more event which was in investors sights and pushed indices to finish the trading session in the red zone, was the annual meeting of the FED. The FED reconsidered the policy, and Janet Yellen reported at her press conference that the program of quantitative mitigation, will most likely be complete in autumn. By the end of 2015, the key interest rate could rise to 1%, and in a year could increase up to 2.25%. Thus, according to her, before the first increase of the interest rate, a considerable amount of time will pass - "half a year or about that".

As a result, the indicator of blue chips, the Dow Jones Industrial Average index, lost 0,70% and went to the level of 16222.17 points, the index of the wide market, S&P 500, decreased by 0.61% to the level of 1860.77 points, and the index of hi-tech companies, Nasdaq, fell by 0,59% reaching the level of 4307,60 points.

Prices of commodities continue to fall. Brent and WTI are adding just 0.10% and are traded on levels of 105.96$ and 99.27$ accordingly. Gold is losing 0.70%, and fell down to the level of 1331.89$ per troy ounce. Silver is decreasing by 1,08% and is traded on a price of 20.60$ per troy ounce.

Yesterday we witnessed a rather interesting and emotional day, filled with important events. At present, the best idea is to try to digest all the news in order to take correct decisions.

Problems between Ukraine and Russia still remain on the agenda, but nevertheless are developing rather quietly and are not having a significant effect on the markets as yet. The acting president of Ukraine, Oleksandr Turchynov, presented the parliament a declaration about the "Fight for Liberation of Ukraine". According to the document, "Crimea was, is and will be a part of Ukraine". Also it was stated that: "The Ukrainian people will never, under no circumstances, stop the fight for liberation of Crimea from invaders, as heavy and as long as it shall be".

Also, the government of Ukraine made the decision to begin to exit from the CIS. Besides that, the Ministry of Foreign Affairs of Ukraine received an order to enter a visa regime with the Russian Federation. Meanwhile, news regarding further sanctions concerning Russia continue to arrive. The leadership of Switzerland suspended negotiations on free trade zone creation with the Customs Union (CU) of Russia, Belarus and Kazakhstan. The government of Germany stopped cooperation in the military sphere between the German defence technology producer 'Rheinmetall AG' and Russia.

One more event which was in investors sights and pushed indices to finish the trading session in the red zone, was the annual meeting of the FED. The FED reconsidered the policy, and Janet Yellen reported at her press conference that the program of quantitative mitigation, will most likely be complete in autumn. By the end of 2015, the key interest rate could rise to 1%, and in a year could increase up to 2.25%. Thus, according to her, before the first increase of the interest rate, a considerable amount of time will pass - "half a year or about that".

As a result, the indicator of blue chips, the Dow Jones Industrial Average index, lost 0,70% and went to the level of 16222.17 points, the index of the wide market, S&P 500, decreased by 0.61% to the level of 1860.77 points, and the index of hi-tech companies, Nasdaq, fell by 0,59% reaching the level of 4307.60 points.

Prices of commodities continue to fall. Brent and WTI are adding just 0,10% and are traded on levels of 105,96$ and 99,27$ accordingly. Gold is losing 0,70%, and fell down to the level of 1331.89$ per troy ounce. Silver is decreasing by 1.08% and is traded on a price of 20,60$ per troy ounce.

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