Home Facts market

US Market Rallied after Fed Keeps Interest Rate Low

US Market Rallied after Fed Keeps Interest Rate Low

Write: Akana [2011-08-10]
The Dow Jones industrial average has risen nearly 4 percent, to 11,239 after the index suffered its worst selloff since 2008 on Monday.

The Dow has ended Tuesday's trading up 430 points.

It comes after the index shed 635 points on Monday, the first day of trading following S&P's downgrade of the US credit rating.

Jason Weisberg is a trader with Seaport Securities.

US Market Rallied after Fed Keeps Interest Rate LowI think some of the people that were a little panicked about their stocks saw the bounce this morning as an opportunity to maybe unload some of their positions or at least lighten them up. But quite frankly this is a really momentum driven market. The long term players are really staying away until we see some form of stabilisation in Washington."

Industries that fell the hardest on Monday rebounded in Tuesday's trading.

Meantime, the S&P 500 regained 4.7 percent.

The Nasdaq recouped 5.3 percent.

The reversal comes after the US Federal Reserve announced that it's going to keep its short-term interest rates at near zero for at least another two years.

The Fed's key interest rate has been held at close to zero since 2008.