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US stock market report – Federal Reserve accelerates tapering

It was all about the Federal Reserve overnight with what will likely be the last major economic announcement until close to February next year.

As expected, the central bank will accelerate their tapering of bond purchases to US$30 billion per month, meaning QE will be all but finished by March rather than June.

At the same time, board members of the Fed increased their votes on 2022 rate hikes from one in September to at least three, however, a lot of water will go under the bridge by then.

Inflation expectations were increased from 2.2% to 2.6% and growth expectations cut.

This news came as retail sales numbers slumped, growing just 0.3% in November, well below expectations.

Despite predictions that rate hikes would lead to a market sell-off, all three benchmarks actually reversed losses, the Dow Jones finishing up 1.1%, S&P 500 up 1.6% and Nasdaq up 2.2%.

Electric vehicle makers continue to slump

Company-specific releases have slowed, but the electric vehicle market behind Tesla (NASDAQ: TSLA) and Rivian (NASDAQ: RIVN) continued to be sold off due to their high growth profiles.

Semiconductor stocks rally

The more cyclical business, even in the tech space, performed well with semiconductor makers, AMD (NASDAQ: AMD) and NVIDIA (NASDAQ: NVDA) up around 8% each.

Featured: A look inside the ETF Securities Semiconductor ETF (ASX: SEMI)

US stock market movers

Here’s how other popular US stocks performed on Thursday.

  • Datadog (NASDAQ: DDOG) up 6.4%
  • CrowdStrike (NASDAQ: CRWD) up 6.0%
  • Cisco (NASDAQ: CSCO) up 3.7%
  • JD.com (NASDAQ: JD) down 5.1%
  • Roku (NASDAQ: ROKU) down 8.0%
  • Roblox (NYSE: RBLX) down 9.0%

Back home on the ASX, the S&P/ASX 200 (ASX: XJO) is set to open higher this morning. For a round-up of the latest news, check out my ASX 200 morning report.

The Golden Rules of Investing

We might be experts in retirement, but with combined financial advice experience of 35+ years, we’ve nearly seen it all. 

In mid-2023, our senior team at Wattle Partners Financial Planning put the finishing touches on a brand-new report “The Golden Rules of Investing“.

In this free report, we outline the key principles that determine all of the portfolio construction and investment decisions of Wattle Partners. Collated over decades, this paper should be seen as a work-in-progress, constantly under review in light of the ever-evolving nature of markets. 

You’ll find the free report on my Author page. Simply click the button below to view the Golden Rules.

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At the time of publishing, the author of this article does not have a financial or commercial interest in any of the companies mentioned.

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Wattle Partners is a financial advice firm, servicing clients around Australia, specialising in retirement planning (pre and post retirement). 

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