US stocks post weekly gains amid Fed rate hikes, tax bill

New York, Dec 17 (IANS) US stocks witnessed solid gains for the week, as investors digested the Federal Reserve's decision to hike interest rates while anticipating details of a Republican tax bill.

For the week, the blue-chip Dow added 1.3 per cent and the broader S&P 500 increased 0.9 per cent, while the tech-heavy Nasdaq jumped 1.4 per cent, Xinhua reported.

The Fed meeting was in the spotlight during the week.

After the conclusion of its two-day policy meeting, the Fed announced on Wednesday that in view of realised and expected labour market conditions and inflation, the central bank decided to raise the target range for the federal funds rate to 1.25 to 1.50 per cent.

"This change highlights that the (Federal Open Market) Committee expects the labour market to remain strong, with sustained job creation, ample opportunities for workers and rising wages," Fed Chair Janet Yellen was quoted as saying.

In determining the timing and size of future adjustments to the target range for the federal funds rate, the Fed will assess realised and expected economic conditions relative to its objectives of maximum employment and two per cent inflation.

The central bank officials still envisioned three more rate hikes in 2018, unchanged from their forecast in September, according to the latest quarterly projections released on Wednesday.

The central bank also raised its GDP estimate from 2.1 per cent in September to 2.5 per cent.

Meanwhile, investors kept a close eye on progress of the country's tax reform.

A last-minute increase to the child tax credit is the latest addition to the Republicans' bill set to be unveiled later Friday, in a move that may secure votes for the plan after key senators wavered, according to the Market Watch.