(MENAFN– ecpulse)
U.S. stocks ended higher Wednesday, lifting benchmark stock indices higher for the week, as investors took a disappointing revision in economic growth as a calming factor about Federal Reserve monetary policy, in addition to comments from Fed officials that also eased fears over the Fed`s stimulus.
The Dow Jones Industrial Average jumped as much as 149.83 points, or 1.02%, at 14,910.14, with Boeing Co. pacing gains that included all but Microsoft Corp. of the Dow’s 30 components.
The S&P 500 climbed 15.23 points, or 0.96%, to 1,603.26, with health care and utilities leading the gains among its 10 major industry groups.
The NASDAQ composite index gained 28.34 points or 0.85% to end at 3376.22.
Gross domestic product expanded 1.8% from January through March, down from an earlier estimate of 2.4%, the Commerce Department reported.
Speaking on Bloomberg television Wednesday, Federal Reserve Bank of Richmond President Jeffrey Lacker called the 1.8% GDP figure consistent with his outlook, and said the central bank was not anywhere near to making cuts in its balance sheet.
Yields fell after the government reported that the U.S. economy grew at a significantly slower rate than previously thought in the first three months this year. The annual rate is now estimated at 1.8 percent, compared with an earlier forecast of 2.4 percent.
Yields have climbed since Bernanke discussed the potential tapering of bond buys. The 10-year Treasury note yield, which moves inversely to price, rose 5.5 basis points to 2.597% on Tuesday, once again hitting its highest level since August 2011, but fell 6.7 basis points on Wednesday.
The recent spike had worried investors that a sudden increase in mortgage rates could undermine the recovery in the U.S. housing market. Some homebuilder stocks rose following the easing in interest rates. Lennar rose 66 percent, or 1.8 percent, to $35.88 and Toll Brothers rose 34 cents, or 1.1 percent, to $32.30.
Markets were higher in Europe. Benchmark indexes rose 2 percent in France and 1.8 percent in Spain. Borrowing costs fell sharply for Spain and Italy as investors bought European government bonds.
The Dollar Index , which tracks the performance of the U.S. dollar against a basket of other major currencies, jumped to a three week high at 83.41 earlier, and closed at 82.70.
Gold slumped to its lowest in 34 months Wednesday. Spot gold ended at $1226.17 per ounce, down from an opening of $1277.12 per ounce.
Crude oil futures for August delivery climbed to $95.46 per barrel, after an opening at $95.17 per barrel.
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