CLOSING UPDATE: FOMC Leaves QE Unchanged, Driving Stocks To Record Highs

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U.S. stocks closed at record highs after the Federal Open Market Committee announced a near unanimous decision to keep quantitative easing unchanged at $85 billion. Interest-rate sensitive securities outperformed the rest of the market with homebuilders like Pulte ( PHM ) and KB Homes ( KBH ) posting significant gains as the Fed signaled its intention to keep rates low until there is more evidence of a stronger recovery. All three indices closed at new highs and Treasury yields plunged as much as 15 basis points in reaction to the Fed's continued efforts to stimulate the economy with low interest rates and abundant liquidity.

Today's less than expected increase in housing starts and permits was eclipsed by the FOMC vigil and failed to generate any reaction by the financial markets. There were 891,000 new housing starts and 918,000 new permits in August, below estimates for 915,000 starts and 950,000 permits.

Here's where the markets stood at the close:

US MARKETS

Dow Jones Industrial Index was up 147.21 (+0.95%) to 15,676.94

S&P 500 was up 20.76 (+1.22%) to 1,725.52

Nasdaq Composite Index was up 37.94 (+1.01%) to 3,783.64

GLOBAL SENTIMENT

FTSE 100 was down 0.17%

Nikkei 225 was up 1.35%

Hang Seng Index was down 0.27%

Shanghai China Composite Index was up 0.29%

UPSIDE MOVERS:

NOK, Credit Suisse upgraded the stock to Outperform from Neutral

SOHU, Sogou Inc. unit has paid holders of Series A Preferred Shares a special dividend totaling about $301 million.

VIPS, Deutsche Bank upgraded the stock to Buy from Hold

DOWNSIDE MOVERS

TWGP, The company again delayed the release of its second-quarter results, prompting FBR Capital to cut its investment rating on the insurance underwriter's stock

TGI, The aerospace firm said it expects to record $68 million in additional pre-tax program costs associated with its 747-8 program during FY14

DRWI, Priced 11.9 million new shares at $2.10 each, a discount of about 15% to Tuesday's closing price



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

Copyright (C) 2014 MTNewswires.com. All rights reserved. Unauthorized reproduction is strictly prohibited.


This article appears in: Investing , Commodities

Referenced Stocks: KBH , PHM

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