By Caroline Valetkevitch
NEW YORK (Reuters) – The benchmark S&P 500 briefly crossed the 3,000-point mark for the first time on Wednesday after dovish remarks from Federal Reserve Chairman Jerome Powell boosted the case for an interest rate cut later this month.
The Nasdaq and the Dow also scaled all-time highs after Powell, who gave semi-annual testimony on monetary policy before the U.S. House of Representatives Financial Services Committee, said the central bank stands ready to “act as appropriate” to support record U.S. economic growth.
Stocks briefly added to gains following minutes from the last meeting of Fed policymakers. The minutes from the June 18-19 meeting showed that many Fed officials thought more stimulus would be needed soon if risks to the U.S. economy did not let up.
Amazon.com, Microsoft Corp and Apple Inc were among the biggest boosts to the indexes.
Powell also pointed to economic risks, including persistently weak inflation, slowing global growth and a downturn in business investment.
“The recent rally is speculation on the Fed lowering interest rates to continue to perpetuate this amazing recovery we’ve had. In Powell’s testimony today, he referenced that quite often – that the Fed’s job is to perpetuate this recovery by achieving full employment and controlling inflation, and they’ve done both,” said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York.
“I’d say that’s what’s dominated the market over the past month or so.”
The Dow Jones Industrial Average rose 90.75 points, or 0.34%, to 26,874.24, the S&P 500 gained 13.3 points, or 0.45%, to 2,992.93 and the Nasdaq Composite added 51.65 points, or 0.63%, to 8,193.38.
The S&P 500 index of financial shares, which tend to benefit in a higher interest rate environment, retreated 0.3% after Powell’s comments.
Advancing issues outnumbered declining ones on the NYSE by a 2.07-to-1 ratio; on Nasdaq, a 1.26-to-1 ratio favored advancers.
The S&P 500 posted 72 new 52-week highs and two new lows; the Nasdaq Composite recorded 94 new highs and 37 new lows.
(Reporting by Caroline Valetkevitch; Additional reporting by Medha Singh, Manas Mishra and Shreyashi Sanyal in Bengaluru; Editing by Sriraj Kalluvila and Jonathan Oatis)