Investing.com – Wall Street added to what had been the strongest one-day climb in four months in the previous session, as worries about the U.K.’s shock decision to leave the European Union (EU), known as a Brexit abated, boosting appetite for riskier assets, while oil got a boost from a bigger-than-expected draw in stockpiles and upbeat data caused markets to lower the chances of a rate cut from the Federal Reserve (Fed).
At 15:40GMT or 11:40AM ET, the Dow 30 jumped 220 points, or 1.27%, the S&P 500 rose 28 points, or 1.38%, while the tech-heavy NASDAQ Composite advanced 74 points, or 1.57%.
Federal Reserve (Fed) governor Jerome Powell became the first Fed official to comment on the Brexit after the market close on Tuesday, warning that it could pose a new drag on the U.S. economy at a time when momentum in the U.S. job market may already by slowing.
“The Brexit vote has the potential to create new headwinds for economies around the world, including our own,” Powell stated, adding that global risks had shifted to the downside.
However, Wednesday’s data was generally upbeat and appeared to push down market expectations for a rate cut, with the chance for the July meeting dropping to 1.2%, from the prior day’s 4.8%. Fed fund futures still predicted on Wednesday that the central bank would remain on hold this year.
With regard to the data, personal spending increased by a seasonally adjusted 0.4% last month, which was in line with forecasts, but still showed that consumption was picking up.
Personal income did come in slightly below expectations, but the core PCE price index for May revealed the inflationary pressures remained in check.
While National Association of Realtors’ (NAR) pending home sales index slumped more than expected, NAR chief economist Larry Yun explained that “there are simply not enough homes coming onto the market to catch up with demand.”
Meanwhile, oil extended gains after data showed that oil supplies in the U.S. fell more than expected last week.
Specifically he U.S. Energy Information Administration said in its weekly report on Wednesday that crude oil inventories fell by 4.1 million barrels in the week ended June 24.
Market analysts' expected a crude-stock decline of 2.4 million barrels, while the American Petroleum Institute late Tuesday reported a supply drop of 3.9 million barrels.
U.S. crude futures gained 2.65% to $49.12 by 15:43GMT, or 11:43AM ET, while Brent oil traded up 2.70% to $50.59.
In company news, despite the fact that Nike’s (NYSE:NKE) revenue and future orders fell short of estimates, the athletic apparel company managed to gain more than 1% as various brokers maintained bullish recommendations.
Monsanto (NYSE:MON) gained more than 1% despite weak earnings as the seed company said it was in in talks with Bayer AG 's (DE:BAYGn) management and others regarding "alternative strategic options."
Drone-maker AeroVironment Inc (NASDAQ:AVAV) tumbled nearly 5% after posting a decline in quarterly revenue and issued a financial outlook that largely fell short of expectations.
Honeywell International Inc (NYSE:HON) traded flat on the news that chief executive Dave Cote will step down and be replaced by chief operating officer Darius Adamczyk.