Investing.com - Stocks on Wall Street jumped right after the text of Federal Reserve Chairman Jerome Powell’s speech was released midday, with many taking the remarks to be an indication that there is less of a need for regular rate hikes in 2019.
The Dow jumped more than 500 points, rising about 2.2% at 2:20 PM ET (19:20 GMT). The S&P 500 was up 1.8% and the Nasdaq Composite gained 1.3%.
“Interest rates are still low by historical standards, and they remain just below the broad range of estimates of the level that would be neutral for the economy ‑‑ that is, neither speeding up nor slowing down growth,” Powell said in prepared remarks in New York.
Many investors believe that the Fed can end its steady tightening cycle once a neutral rate is reached.
Powell said the Fed’s “gradual pace of raising interest rates has been an exercise in balancing risks,” but added “there is no preset policy path.”
Stocks were already in the green before the Powell boost after White House economic adviser Larry Kudlow on Tuesday held open the possibility that the U.S. and China would reach a trade deal.
"Trade has been an issue for a long time and any hint that the China-U.S. trade dispute could be resolved could make a pick up in global growth," said Kim Forrest, senior portfolio manager at Fort Pitt Capital Group in Pittsburgh.
Techs were helped by Salesforce.com's strong quarterly earnings report, a rise in chip stocks, the FAANG group and U.S.-listed shares of Chinese companies.
Salesforce.com (NYSE:CRM) jumped 8%.
Tiffany & Co (NYSE:TIF) plunged 11% after the high-end jeweler's quarterly same-store sales missed estimates.
-- Reuters contributed to this report.