Qa'dah 27, 1431 H/ Nov. 04, 2010, SPA -- U.S. stocks finished higher Wednesday, as investors received the Federal Reserve's highly-anticipated announcement of a second round of asset purchases to strengthen the economy. The Fed said it will buy $600 billion in long-term Treasuries by the middle of next year at the pace of $75 billion a month. The Fed policy, know as quantitative easing, is designed to keep interest rates low and supply money for the slow economy. At the conclusion of its two-day meeting Wednesday, the Fed also announced it will reinvest an additional $250 billion to $300 billion in Treasuries with the proceeds of its earlier investments. The central bank kept the federal fund rate at historic lows near zero. As expected, the midterm elections resulted in big gains for the Republican Party, which won control of the House of Representatives by capturing at least 60 seats. Investors expect a Republican majority will boost the market since the party is viewed as more business friendly and fiscally conservative than the Democrats. President Barack Obama said on Wednesday he takes responsibility for the fact that Americans across the country are frustrated with the pace of the economic recovery and hopes lawmakers will be able to find common ground in order to make progress. In economic news, a report from Automatic Data Processing showed that private-sector employers added 43,000 jobs in October, rebounding from a small decline in the previous month. In a second report, employers announced 37,986 job cuts last month, up 2.2 percent from September. However, the October number was still well below the year-ago level. The Institute for Supply Management's services index rose 54.3 in October, from 53.2 in the previous month. Analysts expected the service sector to expand to rise to 53.4. Another government report showed that factory orders improved 2.1 percent in September. Analysts were expecting order to rise 1.7 percent. The U.S. dollar fell against the euro and rose against the yen. Light sweet crude oil for December delivery gained 79 cents to $84.69 a barrel on the New York Mercantile Exchange. Gold futures fell $19.30 to $1,337.60 an ounce. The Dow Jones industrial average rose 26.41, or 0.2 percent, to 11,215.13. The broader Standard & Poor's 500 index rose 4.39, or 0.4 percent, to 1,197.96. The technology-heavy Nasdaq composite index rose 6.75, or 0.3 percent, to 2,540.27.
