Stocks rose on Wednesday, bolstering their gains for the month, after the Federal Reserve opened the door for looser monetary policy in the near future.
The Dow Jones Industrial Average finished positive 38.46 points to 26,504
The S&P 500 added 8.71 points to 2,926.46.
The NASDAQ Composite reacquired 33.44 points to 7,987.32
Health-care stocks, which typically perform well after the Fed cuts rates, were the best performers on Wednesday. The sector rose 1%, led by gains in Allergan and DaVita.
Banking stocks moved downward, Citigroup, Morgan Stanley, J.P. Morgan Chase and Bank of America all traded lower.
The Fed kept interest rates unchanged at the meeting, as was widely expected. While not outright signaling a cut was ahead this year, the Fed did drop the word “patient ” from its statement and said it would “act as appropriate” to sustain the economy.
The central bank’s rate projections, released alongside the statement on Wednesday, showed that eight Fed members see a cut this year, which traders took as further sign the central bank was close to cutting rates. Its median forecast, however, still reflected no cuts this year, but additional easing in 2020.
Fed Chair Jerome Powell also said in a news conference after the announcement that some Fed officials believed the case for easier monetary policy had strengthened.
Expectations of lower rates helped the market rebound this month after a torrid performance in May. The S&P 500, Dow and NASDAQ are all up more than 6% in June.
Prices for the benchmark 10-year U.S. Treasury gained sharply, causing yields to fade to 2.03% from Tuesday’s 2.06%. Treasury prices and yields move in opposite directions.
Oil prices regained 42 cents to $54.32 U.S. a barrel.
Gold prices re-strengthened $9.40 at $1,348.30 U.S. an ounce.
