Wall Street’s Fed relief rally seen continuing

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Wall Street looked set to open higher, as stocks in Europe enjoyed a relief rally over the U.S. Federal Reserve’s accommodative policy stance.

Investors cheered Fed Chair Janet Yellen’s decision to reiterate that interest rates would not be hiked for a “considerable time” after quantitative easing ended, sending the Dow to a record high overnight.

“Language around economic activity was practically identical to the July statement,” Evan Lucas a market strategist at IG Markets, said in a research note.

However, the Fed did project a faster pace of hikes that previously suggested. Rates are now seen at around 1.375 percent by the end of 2015, versus the 1.125 percent forecast in June.

On Thursday, Yellen will speak on consumer finance at an event in Washington. Dallas Fed President Richard Fisher speech at a separate event might shed light on his hawkish case for near-term policy action.

Data-wise, the Philadelphia Fed index for September is due, along with the usual weekly jobless claims and August housing starts.

No major companies are expected to report earnings before Wall Street opens. Oracle will post numbers after markets close.

Also after the close, Alibaba is set to launch the biggest-ever initial public offering (IPO). The Chinese company is seen pricing its shares on the Nasdaq exchange between $66 and $68, meaning the issue could be worth as much as $21.8 billion.

 

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