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The Federal Reserve's move to raise the discount rate by a quarter of a percentage point on Thursday evening may have set off alarms over the end of easy credit, but so far the stock market is taking the Fed's well-telegraphed move in stride.

After a mild setback at the start of trading, U.S. indexes moved into positive territory by midday trading. At noon, the Dow Jones industrial average was up 40 points or 0.4 per cent, to 10,433. The broader S&P 500 was up 5 points or 0.4 per cent, to 1111.

Utilities made a rare move to the front of the 10 subindexes within the S&P 500, rising 1.5 per cent - a move made more interesting by the fact that these dividend-yielding stocks tend to be sensitive to rate hikes, which are on everyone's minds right now.

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Industrials and financials rose 0.5 per cent each. Energy stocks and information technology stocks were the only declining subindexes, but were down just 0.1 per cent each.

In Canada, the S&P/TSX composite index was up 30 points or 0.3 per cent, to 11,725.

Health care stocks, which have the smallest weighting within the benchmark index, enjoyed the biggest bounce, rising 0.8 per cent. Utilities rose 0.6 per cent and energy stocks rose 0.5 per cent. Financials rose 0.2 per cent.

Materials were among three declining subindexes, falling 0.1 per cent - although some of the big names, including Teck Resources Ltd. and Barrick Gold Corp. moved higher.

Editor's note: An earlier post incorrectly said the Fed moved on Wednesday evening. That has been corrected.

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About the Author
Investing Reporter

David Berman has been writing about business and investing since 1995. He has written for a number of magazines, including Canadian Business and MoneySense. He worked at the Financial Post as an investing writer and daily columnist before moving to the Globe and Mail in 2008. More

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