How did the stock market do today? All major benchmarks erased earlier gains in the last 15 minutes of trading to close in the red. The Dow Jones fell 11 points.
Investors weighed fluctuations in the U.S. dollar and its effect on global commodity prices.
Gold prices rose $3.10 to hit $1,187.70 per ounce. Silver prices climbed one cent to $16.89 an ounce.
Today's Scorecard:
Dow: 18,116.04, -11.61, -0.06%
S&P 500: 2,104.42, -3.68, -0.17%
Nasdaq: 5,010.97, -15.44, -0.31%
What Moved the Stock Market Today: The markets were relatively muted this afternoon as investors are still digesting monetary policy decisions from the U.S. Federal Reserve. Stanley Fischer, who is second-in-command at the Federal Reserve, said this morning that the bank is "widely expected" to raise interest rates later this year and that the decision could come after any FOMC meeting when policy makers feel the time is right.
Brent crude oil prices gained roughly 1.1% on the day, despite increased concerns about global oversupply. Saudi Arabia announced today it is pumping more than 10 million barrels of crude per day, a new record for the region. Domestic oil prices gained 1.5% on a weaker dollar. Investors will be keeping a tight eye on inventory reports due out later this week.
Now, check out the other top market stories - plus get our new profit tip for investors:
Wall Street wants you believe a return to "normal rates" via a hike of any kind will lead to a massive market correction.
But the historical precedent is much more nuanced. In fact, the most recent examples point to the opposite happening - rate hikes causing rallies in their aftermath.
Back in 1980, inflation soared. Yet the stock market was in the middle of an impressive bull run, showing strength that was widely out of step with almost every other economic indicator (much like today).
Then, in the spring of 1980, Fed Chairman Paul Volcker began a rate hike that would see rates climb to 19.03%... and stocks rallied through December.
In mid-1983, the Fed decided to increase rates again in pursuit of an even more ambitious 11.44% target over the 8.50% it had already achieved.
The result? The S&P 500 surged immediately. It was still up 6.1% a year later compared to its pre-rate hike levels.
According to Sid Riggs, Money Morning's Director of Research and Performance Measurement, the markets actually went up during six of the last seven periods when the Fed raised rates, gaining an average of 13.47%.
The only time the S&P 500 didn't rise alongside rising rates was back in 1970. That's when the Fed Funds Rate increased from 3.71% to 12.92%. But the Fed hardly has the gall to jack rates by that much.
For all of the power that stimulus has to artificially juice the markets, traders have forgotten that getting the financial house in order is really the great hope here.
That means panic selling - like what happened March 10 when the Dow Jones fell 333 points - is an opportunity to buy.
Keith Fitz-Gerald is a seasoned market analyst and professional trader with more than 30 years of experience. For more investing tips and stock picks from Fitz-Gerald, go here...
