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S&P 500 Cut Losses as Fed Speeds Up Taper, Signals Three Hikes in 2022

Published 12/15/2021, 01:15 PM
Updated 12/15/2021, 02:59 PM
© Reuters.
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By Yasin Ebrahim

Investing.com – The S&P 500 jumped Wednesday, as the Federal Reserve said it would accelerate its taper and projected the first liftoff in rates next year.  

The S&P 500 was up 0.38%, the Dow Jones Industrial Average rose 0.28%, or 101 points, the and the Nasdaq Composite added 0.24%.

The committee said it would increase the taper of its bond purchases by $30 billion a month in January, double the $15 billion monthly pace announced in November.  The timeline on rate hikes was brought forward, with up to three rate hikes projected next year, followed by another three in 2023, taking the Fed's benchmark rate to 1.6%. 

Risk sentiment improved following the announcement as a faster taper was largely believed to have been priced in ahead of the Fed meeting. 

Google-parent Alphabet (NASDAQ:GOOGL), Microsoft (NASDAQ:MSFT), Facebook (NASDAQ:FB), and Apple (NASDAQ:AAPL), which combined make up more than fifth of the broader S&P 500, cut their losses. 

Energy remained under pressure even as oil prices cut their losses as fears persisted about supply outpacing demand in the wake of growing concerns about the Omicron threat on travel, and ultimately energy demand.

Devon Energy (NYSE:DVN), Occidental Petroleum (NYSE:OXY), Diamondback Energy (NASDAQ:FANG) fell more than 2%.

Consumer discretionary moved further off the intraday lows as Tesla (NASDAQ:TSLA) cut the bulk of its losses. 

Health care led the gains in the broader market following a more than 8% jump in Eli Lilly (NYSE:LLY) after the pharmaceutical giant upgraded its earnings outlook for 2021, and guided further strength for 2022.

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Latest comments

is this amateur write this article? in doc, sai will buy more 30b treasury+ 10b other surprising on january. old gone new still in tag. and jerome powell mentions thing could be changes if worse thing escalated
What's the alternative? pump or pump?
What a load of manipulated cr_p!
Yes, they are getting paid to manipulate people. All the time. I want to them to think about this fact the next the feel bad and have problems. I will be somewhere nearby rubbing my hand with and evil grin.
So this means we party like it's 1999 until January?
Exactly :-)
The Fed says, **insert anything here** - Markets explode higher.  Farce.
By the way, God also pointed my attention to the fact that whatever happens, whatever breaking news, FED meeting, interest rate change, you name it S&P 500 and Dow Jones always go up. Just note the fact that they broke their own record like 10 times only during the last year. At the same time your typical American citizen is pressured by increasing bills and inflation. God said he will think of a new virus to penalize the the actors in this TV-drama-like theater.
Right... so tapering and increasing rates are now great for stocks just like QE and low interest rates were also great for stocks? LOL c'mon this farce needs to die
 Yes... buy real assets and get my money out of the banks before the financial system implodes
 I'm a proponent of free markets and price discovery not this Keynesian ponzi
the fact is that of all the loosening they have done...I mean everything...repos....low rates...swap lines...bond purchases...stimulus cheques.....etc etc. the only thing they have done is cut bond purchaes like 13%. that's it. will they do more? maybe a little bit but nearly what they are talking about doing imho. this is probably why the market has taken none of this talk seriously.
it's funny because the FED is letting inflation grow with bond purchases but then the cite the urge to tighten.....why not now? nothing is stopping them. why not wind down bond purchase next month and let the market work. you would think the FED is hawkish....always watch what the do and not what they say
Powell said it could be harmful to the market to stop the free money from day to day... how thoughtful of him
Hello. God just spoke to me. He told me that whoever manipulated the Forex chart, so that initially it seems like the dollar reacts to this news with going up and then someone made it go down without any logical explanation, these same people are now getting pancreatic cancer. God is sending it to them. He also added that morphine is not gonna help with the pain. You can now proceed with your daily routine.
It seems a good news to the market. It signals that Fed is noticed about the severe situation of inflation and gets an action to neutralize it.
the title makes no sense, but copy the market trends
this makes absolutely no sense
High inflation - bad Fed tapering - good to neutralize the economy.We missed this fact. But question here, when the market suppose to do major correction if everything seems good?
...and stocks go up???This is the death knell for markets if the FED carries through with what it "says"
Seems like an outrageous reaction. Market gets pumped over tapering and rate hikes in the midst of slowing retail sales which will only get worse as credit markets tighten up.
this news factoring ,now market goes up.
Nifty 2mrw down
true
why
why such thought
market will close big green
bull run will continue
Market will shoot now
bond tapering will start fast pace but interest rate will remain unchange becouse of omicron,employment,cyclone disaster etc.
Market will shoot
bond tapering will start fast pace but interest rate will remain unchange becouse of omicron,employment,cyclone disaster etc.
will keep unchange
it's going to do nothing
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