NEW YORK (AFP) – Wall Street stocks finished solidly higher on Wednesday, shrugging off recent weakness despite more hawkish Federal Reserve commentary.
Analysts pointed to a drop in oil prices as a key support to US equities on a day that saw investors engage in bargain hunting.
“We got oversold in the short term, and a couple of things broke in the right direction,” said analyst Art Hogan of B. Riley Wealth Management, noting falling crude prices.
The Dow Jones Industrial Average gained 1.4 per cent to close at 31,581.28.
The broad-based S&P 500 rose 1.8 per cent to 3,979.87, while the tech-rich Nasdaq Composite Index advanced 2.1 per cent to end at 11,791.90.
The gains came despite comments from Fed vice-chair Lael Brainard, who warned that the US central bank will stay the course on its aggressive fight against high inflation “for as long as it takes” to bring prices down.
She said interest rates need to rise further, again knocking down hopes of a rate cut next year as the economy slows.
The Fed also released its beige book report survey ahead of its next policy meeting Sept 20-21, which showed prospects for the US economy are flagging as high prices force Americans to focus more of their spending on staples, with demand set to weaken further.
Among individual companies, Twitter climbed 6.6 per cent after a Delaware judge rejected Elon Musk’s request to delay a trial into the cancelation of Musk’s deal to acquire the social media platform.
And Apple closed up 0.9 per cent after unveiling new iPhones as well as a premium digital watch in a launch event ahead of the holiday shopping season.