The Federal Reserve is the central bank of the United States, which was founded on December 23, 1913. Over time, the roles and responsibilities of the Federal Reserve System have been expanded and changes have taken hold. Ben Bernanke, head of the central bank in Washington. The bank also has the authority to print and distribute US dollars.
The FOMC is the US Federal Reserve Open Market Operations Committee. It is the most important part of the Federal Reserve System’s monetary policies. The FOMC has important tasks such as increasing employment, keeping inflation and macroeconomic balance at an acceptable level, and taking measures to promote economic growth.
The Federal Open Market Commitee meets eight times a year to assess economic trends and determine their monetary policy. FOMC Meetings (FOMC Minutes) are announced three weeks after the FED meetings. In the meeting records; The reasons behind the decisions of the FED meetings include the FOMC members’ view of the macroeconomic outlook, the duration of economic measures and interest rate decisions, and forecasts for future periods. Investors look for clues in this long text for changes that may occur in the FED’s monetary policies.
Interpretation of FOMC Decisions
Interest Rate Decisions: Commitments to keep FED’s policy rate at certain levels are affecting the course of the US dollar and commodities. For example; A clue to the prolongation of the rate at which interest rates are held at very low levels will create a low interest-weak dollar sense. Read More
If we explain by giving an example; The US Dow Jones (US30) index is composed of the weighted average of the top 30 industrial sectors. Numbers written near the country indexes indicate how many shares are in the index. There are also sectoral indices within the stock market indexes. .
If we look at world indices; The NASDAQ Index (USTEC) is the American Index, which includes the top 100 non-financial technology companies listed on the Nasdaq stock exchange. Another difference of this index from other indices is that it includes companies that are not American corporations. Organizations must be listed with a volume of 200,000 shares in the Nasdaq stock market for at least two years to be included in the indexes, but not in any business case.
When trading in the world stock market indexes, you should follow all the information about the world economy, the economic and political developments of the country where the index belongs, the state of the stocks in the stock market indices and the indices.
In particular, it should be noted that the decisions of the Federal Reserve. Federal Reserve (FED) and the European Central Bank (ECB) are very influential on the world stock market index values.