New Fed Chair Helps Stocks to Triple-Digit Gains
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iStock/Thinkstock(NEW YORK) — On her first day front and center before Congress, new Federal Reserve Chair Janet Yellen told the markets just what they wanted to hear, and stocks soared as a result.
The Dow Jones Industrial Average closed up 192 points at 15,994.77 — the fourth straight day of gains.
Yellen told Congress that the Fed will keep interest rates low for the foreseeable future, and it will also continue to pay close attention to the economy and jobs before making any future decisions about pulling back any further on its $65 billion-dollar-a-month bond buying program.
As Clearpool Group’s Peter Kenny noted, “Markets received the soothing tonic they were aching for and have responded accordingly.”
Paul Edelstein of HIS Global Insight added, “Yellen’s testimony confirms our long-standing view that we are still some distance from an exit from the Fed’s ultra-low interest rate policies. We think that the Fed will not raise interest rates until late in 2015, consistent with most Fed members’ assessments.”
In January the Dow fell close to 900 points — more than 5 percent — the largest one-month point drop since early 2009. And February started with another 300-point drop. Since then, the Dow’s rallied close to 4 percent.
On Tuesday in addition to the Dow, the S&P 500 and the NASDAQ surged more than one percent.
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