Stock market news updates in real time: March 17, 2022

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Stock market news updates in real time: March 17, 2022

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US stock futures opened slightly higher during extended trading Wednesday after a pivotal session on Wall Street marked by the Federal Reserve’s long-awaited move to raise short-term interest rates for the first time in three years.

Contracts related to the S&P 500, Dow and Nasdaq were firmly in green at the start of futures trading after all three indices rebounded in the last 30 minutes of Wednesday’s main session from an initial dip shortly after the latest policy decision. Fed released at 2pm ET.

At the end of the two-day policy-making meeting, the central bank revealed that it will raise the Federal Funds Policy Rate by 0.25%, bringing it to a target range of 0.25% to 0.50%. %. The move was in line with market participants’ expectations after Fed Chairman Jerome Powell indicated in Congressional testimony earlier this month that a 25 basis point hike was clearly possible.

“By raising interest rates, the Federal Reserve has started the process of easing pandemic-era stimulus measures in an effort to tame inflation,” Bankrate chief financial analyst Greg McBride said in a statement. “This is not a one-time event, but the start of a series of rate hikes for the rest of the year and next.”

The Fed also unveiled in its updated summary of economic projections, or “dot plot,” which reflects individual economic projections from Federal Open Market Committee policy makers, that the median member expects up to six further rate hikes in 2022, the which would bring 1.75% higher rates at the end of this year. Prior to Wednesday’s decision, the benchmark interest rate was deliberately kept near zero since mid-2020 as part of the Fed’s easy money policies used to keep financial conditions running smoothly during the pandemic.

“The Fed hasn’t rocked the boat much,” said Ryan Detrick, chief market strategist at LPL Financial. “Yes, they lowered economic expectations in 2022 while also raising inflation, but much of that was already priced. Overall, they are still seeing strong growth, which helps support the recovery.”

The Marriner S. Eccles Federal Reserve Board building is located in Washington, DC on March 16, 2022. - The Federal Reserve is expected to announce the first interest rate hike since the start of the Covid-19 pandemic at the end of the its policy-making meeting later today.  (Photo by SAUL LOEB / AFP) (Photo by SAUL LOEB / AFP via Getty Images)

The Marriner S. Eccles Federal Reserve Board building is located in Washington, DC on March 16, 2022. – The Federal Reserve is expected to announce the first interest rate hike since the start of the Covid-19 pandemic at the end of the its policy-making meeting later today. (Photo by SAUL LOEB / AFP) (Photo by SAUL LOEB / AFP via Getty Images)

While the key decision provided some clarity to investors who have been waiting for months for the central bank to move forward on tightening monetary conditions, the Fed’s path remains confused by the geopolitical turmoil in Eastern Europe. The war in Ukraine and the criminal sanctions against Russia for its invasion of the country have raised uncertainty in recent weeks over the balance of the conflict over the global economic framework.

The Fed acknowledged in a statement coming out of its meeting that the implications for the US economy are “highly uncertain” but could worsen inflationary pressures that have already been high for decades.

“Recovery is the theme Fed officials have flagged to markets today as the narrative has shifted from normalizing monetary policy to laying the groundwork for tighter policy and moving beyond neutrality,” said Charlie Ripley, strategist. Investment Management senior market report, in a comment.

Elsewhere in the markets, shares of Warren Buffett’s Berkshire Hathaway closed at $ 500,000 for the first time on Wednesday. The price underscored Berkshire’s status as a defensive stock at a time when markets were rocked by economic and geopolitical uncertainty.

Berkshire’s Class A shares were up 10% in 2022, although the S&P 500 was down about 12% year to date. Prior to Wednesday’s relief rally, Tuesday’s benchmark index (the 50th trading day of the year) stalled on its sixth worst start to the year ever, data from LPL financial shows. The silver lining? The previous five worst starts have been followed by substantial earnings, with an average earning for the remainder of the year of 36%, except for 2001 alone.

“While we don’t expect 36% gains for the remainder of this year, it suggests things could be pretty bad now, but we’ve been here before and have seen the shares return much more than expected,” LPL’s Detrick said.

6:02 PM ET: Futures rise after stocks closed higher following the Fed’s decision

Here’s where stock futures were ahead of Wednesday’s overnight session:

  • S&P 500 futures (ES = F): +8.25 points (+ 0.19%) to 4,366.25

  • Dow futures (YM = F): +51.00 points (+ 0.15%) to 34,110.00

  • Nasdaq Future (QN = F): +29.25 points (+ 0.21%) to 13,982.25

  • Raw (CL = F): + $ 0.30 (+ 0.32%) to $ 95.34 per barrel

  • Gold (GC = F): + $ 17.00 (+ 0.89%) to $ 1,926.20 per ounce

  • Ten-year treasure (^ TNX): +2.8 bps for a yield of 2.1880%

NEW YORK, NEW YORK - MARCH 16: Traders work on the floor of the New York Stock Exchange (NYSE) on March 16, 2022 in New York City.  The Dow started the day in positive territory, extending yesterday's rally.  (Photo by Spencer Platt / Getty Images)

NEW YORK, NEW YORK – MARCH 16: Traders work on the floor of the New York Stock Exchange (NYSE) on March 16, 2022 in New York City. The Dow started the day in positive territory, extending yesterday’s rally. (Photo by Spencer Platt / Getty Images)

Alexandra Semenova is a Yahoo Finance reporter. Follow her on Twitter @alexandraandnyc

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