Stock market recovers early Thursday from steepest selloff in months

NEW YORK, Dec 19 (Reuters) – Wall Street rebounded and U.S. Treasury yields resumed their climb early Thursday as stocks recovered from their steep dive in the wake of the Federal Reserve’s hawkish outlook.

The dollar gave back some of Wednesday’s gains and gold rallied as investors grew accustomed to the reality that the central bank will take a slower, more measured approach to policy easing in the coming year.

The cautious note struck by the Fed’s economic projections and the expected slowdown of rate cuts prompted the steepest U.S. stock selloff in months on Wednesday.

“People are trying to make sense of the market reaction to the Fed yesterday,” said Thomas Martin, senior portfolio manager at Globalt in Atlanta. “Generally speaking, what happened at the Fed was good news; they’re on the job on inflation, the economy is strong, the final GDP number of 3.1% ain’t bad.”

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