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Originally published October 29, 2013 at 5:54 AM | Page modified October 30, 2013 at 3:12 AM

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World stocks rise on hopes Fed to keep stimulus

World stock markets charged higher Wednesday after the Dow Jones industrial average hit an all-time high on expectations the Federal Reserve will keep its economic stimulus fully in place until next year.


Associated Press

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MANILA, Philippines —

World stock markets charged higher Wednesday after the Dow Jones industrial average hit an all-time high on expectations the Federal Reserve will keep its economic stimulus fully in place until next year.

The Fed is in the middle of a two-day policy meeting at which it's expected to maintain monthly bond purchases of $85 billion that are aimed at stimulating economic growth by keeping borrowing rates very low. The Fed will release its policy statement Wednesday afternoon in the U.S.

The U.S. central bank's cheap money policy has underpinned stock markets worldwide for several years. Markets had been roiled by expectations that the Fed would begin reducing its stimulus this year but weaker U.S. hiring and other economic indicators have built a case for "tapering" of the bond purchases to be delayed until next year.

"The idea being priced in is that tapering might not come in December but possibly even in March next year so that is another issue that drives markets higher," said Herald van der Linde, Hong Kong -based head of Asia equity strategy at HSBC.

In early European trading, Britain's FTSE 100 gained 0.6 percent to 6,815.21. The CAC-40 in France climbed 0.5 percent at 4,301.11 and Germany's DAX was up 0.3 percent to 9,044.55.

Futures in New York indicated a higher opening on Wall Street. Dow Jones and S&P 500 futures were both up 0.3 percent.

Asia's key benchmark, the Nikkei 225 in Tokyo, closed 1.2 percent higher at 14,502.35. Hong Kong's Hang Seng climbed 2 percent to 23,304.02.

China's Shanghai Composite finished up 1.5 percent at 2,160.46. Most other indexes in the region also recorded gains. Australia's S&P/ASX 200 shed 0.2 percent to 5,430.90.

In energy trading, benchmark crude for December delivery was down 59 cents at $97.61 in electronic trading on the New York Mercantile Exchange. The contract dropped 48 cents to settle Tuesday at $98.20.

In currencies, the euro rose to $1.3757 from $1.3745 Tuesday. The dollar rose to 98.23 yen from 98.19 yen.



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