The Fed came to the rescue as it has so many times. The market hit its low on Tuesday down 4.85% from its previous high, on worries about the fast declining price of oil and the negative implications for high yield debt as well as countries like Russia. But a Fed statement that there would be “considerable time” until rates are increased was enough to send the market flying higher, plus 4.3% for the rest of the week. A statement by a Fed official back in October helped turn the market around then after a 7.7% decline, as has similar statements over the last couple of years.
Bloomberg Graphics shows why lower oil prices are not leading to higher. Click to see.