Major indexes of the U.S. NYSE continued to rise due to improved investor sentiment amid positive acceptance of the Federal Open Market Committee (FOMC) results and calming concerns over China’s Evergrande Group.
On the 23rd (local time), the Dow Jones 30 Industrial Average closed at 34,764.82, up 506.50 points (1.48%) from the previous day. The Standard & Poor’s 500 index also closed at 4,448.98, up 53.34 points (1.21%) from the previous day, while the technology-oriented NASDAQ index also closed at 15,052.24, up 155.40 points (1.04%).
The stock market seemed to be watching the FOMC results and the possibility of default of China’s Evergrande Group.
At the U.S. Federal Reserve’s FOMC regular meeting the previous day, tapering was signaled that it was imminent, but the market did not seem to worry much. Half of the committee members expected the first rate hike in 2022, and the timing of the rate hike was also earlier than before.
However, there was a relief rally in the market in that this was generally the level expected by the market.
Conflicting news came out regarding the Evergrande Group incident in China. Citing sources, Bloomberg reported earlier that government officials ordered them to avoid defaulting dollar bonds in the near future.
On the other hand, the Wall Street Journal also quoted sources as saying that Chinese authorities have instructed local governments to prepare for Hengda’s bankruptcy crisis and take follow-up measures.
Before the news came out, the Hong Kong stock market rose more than 1%, and Evergrande Group’s stock price also rose more than 17%.
The Bank of England has decided to freeze its key interest rate at 0.1 percent and maintain an asset purchase program. It also judged that if the economy progresses extensively as expected, a slightly tight monetary policy may be needed for inflation. The news raised the value of the pound against the U.S. dollar.
It was also reported that the Biden administration delivered to federal agencies by Sept. 30 to prepare for a federal shutdown if Congress fails to pass the temporary budget bill.