US stocks trade higher after Fed raises interest rates and investors digest potential for 7 hikes in 2022

The Federal Reserve hiked its interest rate on Wednesday, causing the US stock market to jump.

The Fed Funds rate was raised to a range of 0.25 to 0.50%. The Fed cut rates amid the start of the Pandemic in March 2020. The dot plot from the Fed shows that more rate hikes are on the way.

According to the dot plot, the Fed funds rate could rise to just below the 2.00% level in 2022, with a potential for seven rate hikes. That would mean an interest rate hike at every Fed meeting in 2022.

At 4:00 p.m., the US indexes stood here. The close is on Wednesday.

The Fed said it will start to reduce its balance sheet later this year, and some, including Fed President James Bullard, expect the potential for a 50 basis point rate hike rather than the traditional 25 basis point hike.

The economy is growing strongly, is creating jobs in significant number and is experiencing the fastest rate of annual inflation for forty years, which is why Bullard has been the most hawkish member of the Fed for some time.

If consumers and the economy start to weaken due to uncertainty surrounding the recent spike in commodity prices and Russia's ongoing attack against Ukraine, the Fed could change its policy stance.

Ukrainian President Volodymyr Zelenskyy asked the US government for a no-fly zone to protect its airspace from Russian attacks. He acknowledged US reluctance to enforce a no-fly zone, which could escalate the conflict between Russia and Western countries.

The stock market in China saw a big jump on Wednesday after the Vice premier pledged support for policies that would benefit the stock market.

The nickel markets reopened on Wednesday after a short-squeeze sent prices to more than $100,000 per ton. Before trades were halted again, nickel prices fell about 5%.

Oil prices entered a bear market earlier this week and are now well below their recent highs.

The price of West Texas Intermediate crude oil fell as much as 1.22%). The price of oil fell as much as 1.85%.

There was a 4.22% rise in the price of the digital currency. The price of ether increased to $2,746.

The price of gold fell to $1,921.10 per ounce. The yield on the 10-year Treasury went up.