Stocks Tick Higher as Fed Meeting Begins

Before you go, we thought you'd like these...
Before you go close icon

Although we don't believe in timing the market or panicking over daily movements, we do like to keep an eye on market changes -- just in case they're material to our investing thesis.

As the Federal Reserve began the first of a two-day meeting today, investors continued to bid stocks higher. As of 12:45 p.m. EDT the Dow Jones Industrial Average is up 38 points, or 0.25%, while the S&P 500 has risen 0.34% and the NASDAQ is 0.6% higher. Many believe the Fed will announce the start of a gradual drawdown of its bond-buying program tomorrow, but stocks are continuing to rise because the market has been preparing itself for this move for a number of months. Most investors feel that a small amount of Fed "tapering" is priced into the market and that the Fed will need to begin paring back its $85 billion-per-month bond-buying sooner than later so the economy can gradually learn to stand on its own.

Another date many investors are waiting for is Oct. 1, when the Obamacare health insurance exchanges open up for business. As we inch closer to that day, the Dow's health care stock, UnitedHealth , begins to fluctuate more and more. Yesterday the stock was up 0.85%; today it's down 1.18%. Investors clearly don't know whether the exchanges will be a good thing for the company. UnitedHealth has only joined a few of them, opting to sit on the sidelines in other states to wait and see how things play out. Shareholders of any of the health insurance companies should be ready for a few wild days leading up to Oct. 1.

Bank of America is down slightly, while JPMorgan Chase is flat, after the two passed the self-imposed stress tests they must take every year. All the major banks, including Citigroup and Wells Fargo, passed the test and increased their capital ratios, but some analysts have noted that the banks should have used higher interest rates in the long term to give a better picture of what many consider a more realistic scenario, and that may be one reason shares are underperforming today.

Have you missed out on the massive gains in bank stocks over the past few years? There's good news: It's not too late. Bargains of a lifetime are still available, but you need to know where to look. The Motley Fool's new report "Finding the Next Bank Stock Home Run" will show you how and where to find these deals. It's completely free -- click here to get started.

The article Stocks Tick Higher as Fed Meeting Begins originally appeared on

Fool contributor Matt Thalman owns shares of Bank of America, Citigroup, and JPMorgan Chase.  Check back Monday through Friday as Matt explains what caused the Dow's winners and losers of the day, and every Saturday for a weekly recap. Follow Matt on Twitter @mthalman5513 The Motley Fool recommends Bank of America, UnitedHealth Group, and Wells Fargo. The Motley Fool owns shares of Bank of America, Citigroup Inc , JPMorgan Chase, and Wells Fargo. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

People are Reading