Fed Announcement Un-Roils Markets

Equity markets have recouped earlier losses and Treasury bonds have given up gains after the Fed announced just a little while ago that it would start buying individual corporate bond issues in a departure from its pandemic-spawned practice of buying exchange-traded bond funds. The DJIA has now moved up to around 200 points in the green after being down 600 points in early trading. The Ten Year’s yield has moved up to 70 basis points in yield and that makes its current price about unchanged on the day.

Details of the Fed’s buying plans are a little sketchy, but include an internally created index of issues that meet the Bank’s criteria for eligibility in the bond buying program.