Investors seem unmoved by news of the swine flu pandemic and worse than expected GDP news released this morning.
Sentiment seems to have shifted to the positive, as everyone believes we have hit or are close to market bottoms, especially after successfully going through 1Q earnings reports from the major banks and the changes around mark-to-market accounting rules.
However, the late afternoon saw a quick pop and drop due to the Federal Open Market Committee statement:
It looks as though the FOMC thinks the economy could still get worse, but they are willing to stay actively involved in keeping the fed funds rates at an effective 0%.
In light of increasing economic slack here and abroad, the Committee expects that inflation will remain subdued. Moreover, the Committee sees some risk that inflation could persist for a time below rates that best foster economic growth and price stability in the longer term.In these circumstances, the Federal Reserve will employ all available tools to promote economic recovery and to preserve price stability. The Committee will maintain the target range for the federal funds rate at 0 to 1/4 percent and anticipates that economic conditions are likely to warrant exceptionally low levels of the federal funds rate for an extended period.