Stocks Mixed, Fed Changes Policy - Weekly Update Sept. 25, 2017

Tyler Little |

Domestic indexes were mixed last week, as the Dow gained 0.36%, the S&P 500 eked out a 0.08% increase, and the NASDAQ lost 0.33%. [1]International stocks in the MSCI EAFE added a solid 0.68%. [2]

Three stories that have dominated conversations and driven investor attention in 2017 continued last week:

Healthcare policy: The Senate's continuing discussion of healthcare reform impacted stock performance in connected industries.

Tension with North Korea: The markets responded quietly to continuing conflict between President Trump and Kim Jong Un, although some investments saw a bump later in the week.[3]  

Interest rate updates: While the Fed chose not to raise interest rates in its most recent meeting, it indicated that a December hike is definitely still on the table.[4]

When announcing its latest interest rate perspectives, the Federal Reserve also indicated that it would begin to reduce its balance sheet next month.[5]  

But, what does that really mean - and why does the Fed have a $4.2 trillion balance sheet, anyway?


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