June 11 (UPI) — The Federal Reserve announced Wednesday it’s decided to leave interest rates unchanged, and near zero, after its latest policy meeting. The Nasdaq Composite surged to a record high but other major indexes reported losses on the day.
The Fed, which lowered rates twice in March as a result of the coronavirus pandemic, also said it doesn’t expect to raise the federal funds rate until at least 2022.
The Dow Jones Industrial Average and S&P 500 rose on the announcement but ended the day with losses as the Dow fell 229.09 points, or 0.84 percent, while the S&P 500 closed down 0.38 percent. The Nasdaq rose to new highs, gaining 0.67 percent, and closing above 10,000 points for the first time.
“The disruptions to economic activity here and abroad have significantly affected financial conditions and have impaired the flow of credit to U.S. households and businesses,” the committee said in a statement.
“The committee expects to maintain this target range until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals.”
Earlier, the U.S. Labor Department had announced that the U.S. Consumer Price Index fell for the third month in a row in May. Bad news also hit the oil shale industry, with a report from the Institute for Economics and Peace saying that a production dispute between Russia and OPEC could result in the “collapse” of the shale industry.
The Nasdaq continued to be propelled upward by rising Tech stocks as Apple stock rose 2.57 percent, Amazon stock gained 1.79 percent and Google’s parent company, Alphabet, rose 0.87 percent.
Bank stocks, however, fell Wednesday, with Wells Fargo dropping 8.95 percent, Citigroup falling 6.12 percent and JPMorgan Chase sliding 4.07 percent.
Meanwhile, airline stocks continued a downward trend for the week as JetBlue stock fell 11.12 percent, United declined 11.02 percent and American dropped 8.25 percent.