NEW YORK (Reuters) – U.S. stocks ended higher and the S&P 500 index briefly crossed the 3,000-point mark for the first time on Wednesday as remarks by Federal Reserve Chairman Jerome Powell reassured investors about the potential for an interest rate cut later this month.
The Dow also hit an intraday record and the Nasdaq closed at an all-time high following the release of prepared remarks for Powell’s testimony before the U.S. House of Representatives Financial Services Committee.
Powell said the central bank stands ready to “act as appropriate” to support record U.S. economic growth.
“It’s what the market wanted to hear,” said J.J. Kinahan, chief market strategist at TD Ameritrade in Chicago. “Many people thought the jobs report – one data point – would all of a sudden change how the Fed was thinking. But the Fed tends to operate on trends, not data points.”
After Powell’s remarks and release of the Fed’s minutes, interest rate futures appeared to price in greater odds of an aggressive rate cut this month. Expectations for a 50-basis-point cut, which had nearly been snuffed out by stronger-than-expected U.S. employment data on Friday, jumped to 26.6%, according to CME Group’s FedWatch tool.
The S&P 500 breached 3,000 just after the opening, but ended slightly below that level at 2,993.07 points. Some investors said the milestone may boost confidence in a market that has been hitting record highs this year.
Amazon.com, Microsoft Corp and Apple Inc were among the biggest boosters to the indexes.
The Dow Jones Industrial Average rose 76.71 points, or 0.29%, to 26,860.2, the S&P 500 gained 13.44 points, or 0.45%, to 2,993.07 and the Nasdaq Composite added 60.80 points, or 0.75%, to 8,202.53.
In his testimony – the first installment of two days on Capitol Hill this week – Powell pointed