3 factors behind the Wall Street rally
The Dow Jones Industrial Average skyrocketed by over 700 points combined on Wednesday and Thursday after close to two weeks of losses. Michael Santoli, a senior columnist for Yahoo! Finance, joined Jeff Glor on CBSN to discuss the market moves.
Santoli blamed economic uncertainty for the recent swings in the market. "A lot of things people worried about happening really didn't come to pass," Santoli said.
He pointed to three factors that helped lead to the huge gains over the past few days:
Oil prices stopped going down
Plummeting oil prices have caused plenty of headaches for the market, with a barrel of oil now trading for $54 a barrel, roughly half what it was earlier this year. That drop contributed to the market slump, but the price stabilized this week.
"They're still down tremendously off their highs but this idea that really there was something untoward going on in the markets for oil has kind of been allayed a little bit," Santoli said.
Federal Reserve announcement
Janet Yellen, chair of the Federal Reserve, announced Wednesday that the bank would keep interest rates extremely low. The announcement reassured investors who had been worried that would increase rates.
"We had the Federal Reserve come out on Wednesday and say 'We're going to be very patient, we're going to be very painstaking in inching investors and the markets to this point when we ultimately raise interest rates,'" Santoli said, adding he doesn't think the Fed is in a hurry to do that.
December is traditionally a strong month
"There is a traditional sense that the back half of December is strong," Santoli said. Global concerns seemed to spook some investors from the market, he said, but "they seem to be rushing back in the past couple days."
In addition to those factors, job gains continue to be steady, so Santoli is optimistic about the economy heading into 2015.
"Going into next year, it seems like finally the best shot to have a genuinely self-sustaining recovery that accelerates a little bit for the U.S.," he said.