The Dow Jones industrial Average jumped to a record Wednesday as the Federal Reserve signaled it would cut rates several times next year, satisfying investors who hoped the central bank would finally start to acknowledge the slowing trend of inflation with a less-aggressive monetary stance.
The blue-chip index popped 512.3 points, or 1.4%, to 37,090.24 exceeding its previous all-time high in January 2022
The S&P 500 climbed 63.39 points, or 1.4%, to 4,707.09.
The NASDAQ cruised higher 200.57 points, or 1.4%, to 14,733.96.
Shares of Bank of America and Wells Fargo, banks who stand to benefit if the Fed orchestrates a so-called soft landing, each gained more than 2% Wednesday. Home Depot, whose sales could be boosted by a revival in the housing market, gained nearly 3%.
The central bank held the benchmark overnight borrowing rate steady in the 5.25% to 5.5% range as expected, but more importantly it forecast three rate cuts in 2024, which was more than it had previously indicated. Investors have been increasingly hoping for the Fed to give a clearer signal that it would start cutting rates next year with recent inflation data easing.
Prices for the 10-year Treasury screamed higher, lowering yields to 4.02% from Tuesday's 4.21%. Treasury prices and yields move in opposite directions.
Oil prices jumped $1.16 to $69.77 U.S. a barrel.
Gold prices leaped $46.50 to $2,039.70.