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Stocks rallied on Wednesday, with the S&P 500 clawing back more of the rout since late February that took the benchmark briefly into correction territory, as the Federal Reserve forecast it would still cut interest rates two times in 2025.
The Dow Jones Industrials leaped 383.32 points to end Wednesday at 41,964.63.
The broader index regained 60.64 points, or 1.1%, to 5,675.30.
The NASDAQ tallied 246.69 points, or 1.4%, to 17,750.79.
The major averages have been on a roller-coaster ride in recent weeks, as traders navigate soft economic data and uncertainty around President Donald Trump’s tariff policy. The S&P 500 officially entered correction territory last week, and the NASDAQ is still in a correction — meaning it’s down more than 10% from its recent high.
The central bank kept the federal funds rate at a range of 4.25% to 4.5%, a decision that was widely expected. That said, the Fed kept its outlook at two rate cuts coming in the remainder of this year, noting “uncertainty around the economic outlook has increased.”
At the end of the day, traders liked that the Fed kept its outlook for a couple of rate cuts this year, as well as Powell suggesting the economy was still strong. He also said any impact from tariffs on inflation would likely be only short term.
The Fed’s decision comes against a backdrop of rising tensions between the U.S. and major trade partners. President Donald Trump earlier this month imposed levies on goods from Canada, Mexico and China. Canada and China have since retaliated with duties of their own.
Trump’s temporary tariff exemptions on some imports from Canada and Mexico are set to expire April 2.
Prices for the 10-year Treasury sprinted Wednesday, sending yields to 4.25% from Tuesday’s 4.29%. Treasury prices and yields move in opposite directions.
Oil prices were higher 0.38 cents to $67.28 U.S. a barrel.
Prices for gold hiked $1.90 an ounce to $3,055.70 U.S.
