The Federal Reserve Makes its Move, Markets React Immediately

The Federal Reserve announced that it would be continuing operation twist through the end of the year on Thursday and undertaking monthly MBS purchases. Markets jumped after the release. Just under half an hour after the announcement, the S&P was up 0.66 percent or 9.51 points while the dow had risen 0.61 percent, 81.61 points. The NASDAQ also gained 0.66 percent, up 20.48 points. Gold was also on the rise following the announcement as it traded up 1.07 percent around $1,752.20. 10 year treasury bonds jumped after the Fed's announcement too, rising 1.93 percent. The Fed went on to say that it planned to keep its policy stimulative for a considerable amount of time, and that while growth in business fixed investment has slowed, the housing sector continues to show signs of improvement. It also said it planned to buy $40 billion in mortgage backed securities a month, with $23 billion for the remainder of september.