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Stock markets bounce ahead of Fed meeting [Video]

August 9, 2011 |  6:46 am

Stock markets broke their long downward slide as investors look forward to any relief that might come out of Tuesday's Federal Reserve meeting.

Coming off the heels of the worst day of trading since 2008, the Dow Jones industrial average climbed over 120 points in early trading.

The Dow was recently trading up 127.98, or 1.2%, to 10,937.83. The broader Standard & Poor's 500 index was up even more sharply. 

Markets in England and France are up modestly, while Asian indexes recovered some of their losses after opening down Monday night.

After Monday's rout, which was sparked by Standard & Poor's Friday evening announcement that it was downgrading the credit rating of the United States, a number of market analysts concluded that the markets had been driven lower than the economic data warranted.

One economic indicator suggests that executives are viewing stock in their own company as cheap and are buying up shares.

Investors are also eagerly awaiting a statement from the Federal Reserve at 11:15 a.m. PDT Tuesday, which could lay out measures the central bank is taking to support the economy.


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-- Nathaniel Popper

Photo: At the Frankfurt Stock Exchange in Germany, a financial trader monitors the market Tuesday. Credit: Hannelore Foerster / Bloomberg