Market update: US markets sharply lower after Fed announcement – 21.06.2013

Source: Henderson Global Investors

US and Asian markets closed sharply lower yesterday after the announcement by the Federal Reserve (Fed) that it will trim its monthly bond purchases to $65 billion in September and end buying in June 2014 (Dow Jones -2.3% and S&P 500 -2.5%). Gold also suffered, falling below $1300 an ounce to the lowest level since September 2010. On a more positive note, the Fed anticipates the US economy to grow by 2.6% in 2013, which was more optimistic than Wall Street’s predictions.

In Asia, stocks fell for a second day as investors continued to react to the news from the Fed. South Korea’s main index fell by 1.5%. However, breaking the trend was the Nikkei 225, which rose 1.7%. In Europe, the FTSE 100 is recovering after its worst day since September 2011. The FTSE 100 dropped by 3% on Thursday, however, this morning is up 0.4% while the FTSE Eurofirst 300 is up 0.2%.