U.S. stocks cut their losses and moved higher on Wednesday as the market got past one of the big uncertainties heading into year-end. The Federal Reserve signaled a more aggressive unwinding of its monthly bond buying, as expected by the market, and forecast multiple rate hikes on the way next year.
The Dow Jones Industrials climbed 383.25 points, or 1.1%, to glide to the finish at 35,927.43,
The S&P 500 index grabbed 75.76 points, or 1.6%, to 4,709.85.
The NASDAQ raced higher 327.94 points, or 2.2%, at 15,565.58.
Shares of Apple rose nearly 3%, lifting the market averages and continuing the stock's recent momentum. Other Big Tech stocks like Microsoft and Netflix also moved higher. Wednesday's moves marked a reversal from earlier this week, when the NASDAQ underperformed on Monday and Tuesday.
Defensive plays also performed well, with health care stocks such as UnitedHealt, up 3.1% and Amgen rising 2.6%.
Big banks, however, were lower even after the Fed signaled multiple rate hikes are on the way.
JPMorgan and Bank of America shares were lower. Some regional bank stocks, including Comerica, saw modest gains.
The Fed announced on Wednesday that it would wind down its asset purchases, a process known as tapering, at a faster pace amid a continued rise in inflation. The Fed will be buying $60 billion per month of bonds starting in January, down from December's rate of $90 million, and said that it will likely continue that trajectory in the months ahead.
The move comes as the central bank is grappling with the highest inflation level in nearly four decades. The Fed was widely expected to accelerate its taper this month.
This sets the stage for a dramatic policy shift that will clear the way for a first interest rate hike next year. The central bank signaled on Wednesday that its members see three hikes in 2022.
JPMorgan and Bank of America shares were lower. Some regional bank stocks, including Comerica, saw modest gains.
Meanwhile, shares of Apple rose more than 2%, lifting the market averages and continuing the stock's recent momentum. Other Big Tech stocks like Microsoft and Netflix rose after sliding on Tuesday.
Defensive plays also performed well, with health care stocks such as UnitedHealth and Amgen also rose more than 2%.
Retail sales for November came in worse than expected, rising 0.3% month-over-month. Economists surveyed by Dow Jones were looking for a 0.8% month.
Prices for 10-year Treasurys sagged, raising yields to 1.46% from Tuesday's 1.44%. Treasury prices and yields move in opposite directions.
Oil prices regained 84 cents to $71.57 U.S. a barrel.
Gold prices recovered $6.30 to $1,778.60 U.S. an ounce.