The Federal Reserve left a key interest rate as low as zero and the market responded with a substantial bump. Despite a 6.1% decrease in GDP, investors responded to news that the federal funds rate would remain between 0.00% and 0.25%. The Dow Jones Industrial Average increased 169 points to close at 8186. Wednesday’s gain puts the Dow on track for its best monthly showing in more than six years.
Signs that Taiwan’s major computer makers and semiconductor manufacturers appeared to have reached an inflection point in the bottoming process made the iShares MSCI Taiwan fund (EWT: 9.80, +1.06, +12.12%) one of the best performing ETFs on Wednesday. Shares rose 12.9%. Vanguard’s Emerging Markets Stock fund (VWO: 27.50, +1.41, +5.40%) gained 5.4%. Expectations of revived commodities demand pushed up shares of the SPDR S&P Metals & Mining fund (XME: 30.88, +1.45, +4.92%) by 4.8%.
A drop in natural gas prices nipped shares of the United States Natural Gas fund (UNG: 13.01, -0.39, -2.91%) by 2.6%. Betting against the rally did a bit of damage to skeptical investors, as the ProShares Short S&P 500 fund (SH: 70.29, -1.45, -2.02%) shed 2.1%. The big move to equities knocked back shares of the safe haven iShares Barclays 20+ Year Treasury Bond fund (TLT: 98.47, -0.88, -0.88%). It shed 0.7% Wednesday.