U.S. stock indexes rose sharply Wednesday afternoon as Federal Reserve Chairman Jerome Powell hinted that the Fed might be willing to raise interest rates at a slower pace next year. That relieved investors who were concerned that rising rates would drag down the U.S. economy and possibly bring an end to the nine-year-old bull market.
Software maker Salesforce led a rally in technology companies and health care stocks were also higher. Luxury retailer Tiffany plunged after saying tourists from China pulled back on spending in its latest quarter.
KEEPING SCORE: The S&P 500 index surged 51 points, or 1.9 percent, to 2,733 as of 2:15 p.m. Eastern time. The S&P 500 has gained 3.9 percent this week, but would still need to rise another 6.7 percent to return to its record high from late September.
The Dow Jones Industrial Average jumped 553 points, or 2.2 percent, to 25,301. The Nasdaq composite rose 169 points, or 2.4 percent, to 7,252. The Russell 2000 index of smaller-company stocks gained 30 points, or 2.1 percent, to 1,523.
KA-POWELL: In a speech to the Economic Club of New York, Powell appeared to suggest that the Fed might consider a pause in its cycle of interest rate increases next year so it can assess the impact of higher rates. Recent remarks by Powell and other officials have made investors more hopeful that the Fed might raise interest rates at a slower pace next year.
The Fed has been steadily raising those rates since the end of 2015 and is expected to announce another increase in December. But with economic growth in the U.S. and other regions likely to slow down next year, investors are concerned that rising interest rates will hinder the economy and the bull market.
“He’s acknowledging that if you make an interest