Markets at record high as FED unveils taper plan

Major Wall Street indexes posted solid gains and closed at record highs following the Federal Reserve’s announcement that it will begin trimming its monthly bond purchases in November with plans to end them in 2022. At the close in NYSE, the Dow Jones Industrial Average rose 0.29% to hit a new all time high, while the S&P 500 index gained 0.65%, and the NASDAQ Composite index added 1.04%. The Federal Open Market Committee on Wednesday detailed plans to begin scaling back asset purchases later this month, with a view to ending its bond-buying program by June next year. The monthly bond purchases of $120 billion — $80 billion in Treasuries and $40 billion in mortgage-backed securities – would be trimmed by $15 billion a month.

European shares finished at a record high on Wednesday following a strong batch of quarterly earnings, while heavyweight mining stocks recovered from recent losses as commodity prices rose. The pan-European STOXX 600 rose 0.4% to a record-high close of 481.22 points, with basic resources stocks leading gains. The sector added 0.9%, recovering from a near one-month low. German stocks were higher after the close on Wednesday, as gains in the Consumer & Cyclical, Transportation & Logistics and Software sectors led shares higher. At the close in Frankfurt, the DAX gained 0.02% to hit a new 1-month high, while the MDAX index added 0.85%, and the TecDAX index gained 0.59%. France stocks were higher after the close on Wednesday, as gains in the Foods & Drugs, Gas & Water and General Financial sectors led shares higher. At the close in Paris, the CAC 40 rose 0.33% to hit a new all time high, while the SBF 120 index added 0.17%.

Asia Pacific stocks were up on Thursday morning, with investors digesting the latest policy decision from the U.S. Federal Reserve. Japan’s Nikkei 225 rose 0.93%, with markets re-opening after a holiday. South Korea’s KOSPI gained 0.25% and in Australia, the ASX 200 edged up 0.48%. Hong Kong’s Hang Seng Index was up 0.49%. China’s Shanghai Composite gained 0.81% while the Shenzhen Component inched was up 1.23%.

The Russian stock market ended trading in the red under the pressure of falling oil. The weakening of the ruble provided some support to the Moscow Exchange index against the background of the news about the plans of the Ministry of Finance of the Russian Federation to increase the volume of foreign currency purchases. The Moscow Exchange index fell by 0.54% and amounted to 4184.87 points. The RTS index fell by 1.31% to 1,826.65 points.

Oil prices fell to a near four-week low on Wednesday, after U.S. crude stocks rose more than expected, as gasoline inventories in the world’s largest oil consumer hit a four-year low. Brent crude futures fell $2.73, or 3.2%, to settle at $81.99 a barrel, while U.S. West Texas Intermediate (WTI) crude fell $3.05, or 3.6%, to settle at $80.86.