Stocks continued to spike today (Dec. 17) after the Federal Reserve confirmed what many investors already expected. The central bank said it would be “patient” in keeping rates low for a “considerable time” longer.
The Street reported that stocks extended gains after rallying on positive sentiment heading into the Fed announcement. The statement comes at a time of increased volatility in the marketplace against a backdrop of plunging oil prices, softer domestic housing data, weaker economic figures coming out of China, and the Russian economy in freefall.
Crude prices recovered from deep losses suffered earlier after Russian officials said 2015 output would be similar to this year’s at 10.6 million barrels a day. West Texas Intermediate was up 3.6% to $57.94, though remaining at nearly half of the mid-summer peak.
“It’s not the bottom. We’re going to have these bounces. There’s short covering in the futures market,” said Jeff Sica, CIO of Circle Squared Alternative Investments, in a call. “We’re going to see a continuation of the selling based primarily on the fact that there’s significantly less demand than anyone anticipated… It’s way too soon to call bottom on oil prices.”
Crude oil inventories fell 0.8 million barrels last week, according to a release Wednesday from the Energy Information Administration. Economists had expected a drop of 2.4 million after an increase of 1.5 million barrels a week earlier.
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