U.S. stocks surged in early trading Wednesday, pushing the Dow Jones industrial average above 21,000 points for the first time. Banks and other financial stocks led the gainers amid fresh expectations that interest rates will rise. Energy companies also rose as oil prices headed higher. The rally came a day after President Donald Trump addressed Congress, reiterating plans to cut taxes and push for other business-friendly policies.
The Dow jumped 242 points, or 1.2 percent, to 21,055 as of 10:07 a.m. Eastern Time. The Standard & Poor’s 500 index gained 24 points, or 1 percent, to 2,387. The Nasdaq composite index added 59 points, or 1 percent, to 5,885. Small-company stocks continued to outpace the rest of the market, a bullish signal on the economy. The Russell 2000 index rose 24 points, or 1.7 percent, to 1,410.
In his speech, President Trump struck a less confrontational tone than usual and steered away from dramatically negative descriptions of the state of the U.S. economy. He also reiterated his pledges to reform taxes, slash red tape and ramp up spending on defense and infrastructure projects. The promises have helped send U.S. stock benchmarks to records, but President Trump offered little by way of detail.
Investors bid up bank shares in anticipation that interest rates will rise. JPMorgan Chase climbed $2.61, or 2.9 percent, to $93.24. Goldman Sachs rose $6.81, or 2.8 percent, to $254.90.
In Europe, Germany’s DAX was up 1.4 percent, while France’s CAC 40 was 1.6 percent higher. Britain’s FTSE 100 was up 1.1 percent. Earlier in Asia, Japan’s benchmark Nikkei 225 gained 1.4 percent, while Australia’s S&P/ASX 200 slipped 0.1 percent. Hong Kong’s Hang Seng added 0.2 percent. South Korea’s markets were closed for a holiday.
Benchmark U.S. crude was up 29 cents, or 0.5 percent, at $54.30 a barrel in New York. Brent crude, which is used to price international oils, was up 26 cents, or 0.5 percent, at $56.77 a barrel in London.
Bond prices fell and yields rose after a key Federal Reserve official, New York Fed President William Dudley, said the case for raising interest rates had gotten stronger. The 10-year Treasury yield rose to 2.46 percent from 2.40 percent late Tuesday.
The dollar rose to 113.92 yen from Tuesday’s 112.17 yen. The euro slipped to $1.0533 from $1.0597.