Tech Sector Leads U.S. Stocks Higher as Fed Signals Rate Cut

NEW YORK (AP) -

Stocks finished higher Wednesday as Wall Street welcomed new signals suggesting the Federal Reserve is ready to cut interest rates for the first time in a decade.

Technology stocks drove much of the gains, nudging the Nasdaq composite to an all-time high. The benchmark S&P 500 index briefly traded above 3,000 for the first time before pulling back to just below its most recent record high a week ago.

The market climbed early on after Fed Chairman Jerome Powell said that many Fed officials believe a weakening global economy and rising trade tensions have strengthened the case for a rate cut.

The S&P 500 index rose 13.44 points, or 0.5%, to 2,993.07. The index, which set three record highs last week, is now less than 0.1% below its all-time high set last Wednesday.

The Dow Jones Industrial Average gained 76.71 points, or 0.3%, to 26,860.20.

The Nasdaq climbed 60.80 points, or 0.7%, to 8,202.53, a record.

The Russell 2000 index of smaller company stocks rebounded from a brief slide, gaining 2.46 points, or 0.2%, to 1,565.05.

Major stock indexes in Europe closed mostly lower. The dollar fell and the price of gold rose.

The Fed’s benchmark rate currently stands in a range of 2.25% to 2.5% after the central bank raised rates four times last year. Many investors have put the odds of a rate cut this month at 100%.

A quarter-point cut in interest rates, which many investors expect, isn’t likely to have a big impact on consumers’ credit cards or mortgage rates. Powell is due to appear before the Senate Banking Committee on Thursday.

Technology companies accounted for much of the market’s gains Wednesday. Micron Technology climbed 3.7% and Western Digital rose 5%. Communications services stocks and consumer goods makers also rose. Take-Two Interactive added 1.8% and PepsiCo picked up 2%.

Energy stocks also rose as the price of U.S. crude oil climbed 4.5%. Chevron rose 1.7%.

Bond prices rose sharply, sending the yield in the 10-year Treasury note down to 2.06% from 2.10% before Powell’s remarks were issued at 8:30 a.m. Eastern Time.

The drop in yields pulled bank shares lower. When bond yields decline they drive the interest rates that lenders charge for mortgages and other loans lower. Citizens Financial Group dropped 2.8%.

Industrials and materials stocks also lagged the market. Deere & Co. slid 1.6% and Corteva lost 1.8%.

Traders weighed earnings results from several companies.

Helen of Troy vaulted 11.15% after the company reported fiscal first-quarter results that topped Wall Street’s forecasts. Its brands include Hydro Flask, Oxo, Vicks and Revlon.

Shares in WD-40 climbed 8.5% after the seller of lubricants delivered fiscal third-quarter earnings and revenue that exceeded analysts’ expectations.

Energy futures closed broadly higher Wednesday.

Benchmark crude oil rose $2.60 to settle at $60.43 a barrel, the highest level since late May. Brent crude oil, the international standard, gained $2.85 to close at $67.01 a barrel. Wholesale gasoline added 8 cents to $2.01 per gallon. Heating oil climbed 8 cents to $1.99 per gallon. Natural gas picked up 1 cent to $2.44 per 1,000 cubic feet.