With President Donald Trump’s tax reform effort moving toward a final vote in Congress, the Federal Reserve is expected to raise interest rates to bolster economic growth and inflation expectations.
The Fed will also begin reducing its benchmark overnight rate by 25 basis points to 0.25%, the Fed said Tuesday in a regulatory filing.
The rate hike is expected at the end of the year, and will take effect after the end, the Fed wrote.
Investors should buy the S&P 500, the Dow Jones Industrial Average, the Nasdaq Composite, and the Russell 2000 index, the bank said.
The Dow and the S & P 500 are the best performers among the index’s 500-stock group.
The Russell 2000 is also an attractive option for investors.
The S&s has posted double-digit gains over the past year.