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8B Daily News – Thursday, January 26, 2012 Furniture DEPOT 235 S Main St., Red Bluff 530 527-1657 www.thefurnituredepot.net HOURS: MONDAY-FRIDAY 9:00-6:00 SATURDAY 9:00-5:00 • SUNDAY 11:00-5:00 Save up to50%off retail The stock market bounced to its highest close since last spring Wednes- day after the Federal Reserve pledged to keep interest rates near zero for almost three more years. Bond yields dropped Stocks close higher on Fed promise of low rates Wall Street sharply, then climbed back later in the day when investors began looking more closely into the Fed's deliberations. The yield on the five-year Treasury note touched an all-time low. The big moves in both markets came at 12:30 p.m. EST, when the Fed's mon- etary policy committee said it was unlikely to raise Your tax experts 32 Years Plus Experience "Enrolled to practice before the IRS" Open Year-Round New Clients Welcome www.lassentax.com Enrolled Agents: Rose Hablitzel, EA Rex Cerro, EA (530) 527-8225 208 Elm St., Red Bluff All major Credit Cards accepted interest rates before late 2014. It had previously promised to keep rates low into the middle of 2013. The Fed cut rates to near zero in December 2008, during the financial crisis, and has held them there ever since. The announce- ment was a sign that the Fed expects the economy, which is improving, to need significant help for three more years. The Dow Jones industri- al average was down as much as 95 points in the J. E. C. JIM ENGLAND CONCRETE & CONSTRUCTION Residential & Commercial 530-529-4495 945-8295 LIC. #682190 Now at Clark's Drug Store Drew Barrymore's Beauty Secret C & C PROPERTIES Dermal-Ktm morning and about 60 points before the Fed announcement. It shot to a gain of 103 points during the afternoon. The Dow closed up 81.21 points, or 0.6 per- cent, at 12,756.96. That's the highest close since May 10. The Dow peaked for last year in April at 12,810. Before that, it had not been so high since May 2008. In the bond market, the yield on the 10-year Trea- sury note was at 2.05 per- cent an hour before the announcement and quickly fell to 1.92, a significant move. It rose to 1.99 per- cent two hours later. The bounce-back hap- pened at about 2 p.m., when the Fed released details of how the commit- tee voted. Six of its 17 members had favored an interest rate increase this year or next — well before late 2014 in either case. The yield on the five- year Treasury note hit 0.76 percent, an all-time low. Bond yields fall when their prices rise. The Fed's extension of low rates signaled that it expects inflation to stay low. Low inflation makes Treasurys more attractive by helping to maintain the value of bond owners' fixed returns. Rising prices would eat into those returns. The announcement guaranteed that short-term loans will remain cheap, making it easier for investors to finance longer- term purchases, such as 10- and 30-year Treasurys, said John Canally, investment strategist and economist for LPL Financial. Monetary decisions by the Fed can change the market's momentum in the short term but rarely have a longer-term impact, Canal- ly warned. The market changed directions after 22 of the past 24 Fed policy announcements, he said, yet the change evaporates quickly. The market essen- 741 Main Street, Suite #2 Red Bluff, CA 96080 1-800-287-2187 (530) 527-2187 An Independently owned and operated Member of Coldwell Banker Residential Affiliates. 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Those tend to boost bond prices by increasing the overall demand in the market. Chan called the Fed's move insurance against the European debt crisis and a recession across the Atlantic Ocean. Stock buy- ers, he said, were happy about the prospect of low inflation and a Fed leaning toward promoting econom- ic growth. The promise of lower rates pushed the dollar lower against other major currencies. Low interest rates make the dollar less attractive because they reduce the returns traders get on U.S. debt and other bonds priced in dollars. Markets had opened mostly lower on fears about Greece's slow progress in talks with bondholders aimed at reducing that nation's crushing debt load. Technology stocks rose all morning, bucking the wider market, after Apple reported its best quarter and blew away analyst esti- mates because of strong holiday sales of the iPhone and iPad. Apple once again passed Exxon Mobil as the company with the biggest market value. Wall Street was watching the results closely because they were for the company's first quarter since the death of founder Steve Jobs. Apple stock jumped 6.3 percent, helping lift the Nasdaq composite index by 31.67 points, or 1.1 percent, to close at 2,818.31. The Nasdaq is up 8.2 percent this year, nearly twice the gain for the Dow Jones industrial average. Prop Code 4559 Prop Code 4079 Prop Code 4929 Prop Code 4129 Prop Code 4209 Prop Code 4059 $107,000 Prop Code 4289 $110,000 Prop Code 4169 $112,500 Prop Code 4499 $115,000 Prop Code 4949 $119,000 Prop Code 4109 $134,900 Prop Code 4729 $137,700 Prop Code 4099 $140,000 Prop Code 4009 $150,000 Prop Code 4049 $189,000 Prop Code 4229 TEHAMA COUNTY REAL ESTATE TEAM • OPEN 7 DAYS A WEEK www.redbluffcoldwellbanker.com See All Tehama County Listings at Counseling Center Giving Families Hope! 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