New York: Wall Street rose on Friday after Federal Reserve Chair Janet Yellen said the case for increasing interest rates had strengthened, but did not indicate when the Fed would raise rates.
US stocks nearly flatlined immediately after Yellen’s comments, but surged soon after, with all 10 major S&P 500 sectors trading higher.
At 10:52am ET the Dow Jones Industrial Average was up 82.93 points, or 0.45 per cent, at 18,531.34.
The S&P 500 was up 10.25 points, or 0.47 per cent, at 2,182.72.
The Nasdaq Composite was up 28.35 points, or 0.54 per cent, at 5,240.56.
The CBOE Volatility index, known as Wall Street’s “fear gauge”, was down 7.5 per cent, dropping for the first time this week.
A near 0.8 per cent rise in technology and health care stocks led the gains on the S&P.
Financials, which stand to benefit the most if rates are hiked, were up 0.6 per cent and on track for their best one-day percentage gain in three weeks.
“She’s certainly tried to make a case, but the market doesn’t believe that the Fed is going to actually raise rates,” said Brent Schutte, chief investment strategist at Northwestern Mutual Wealth Management.
“Investors are struggling to find anything new in the speech and that maybe by-design by Yellen.” After Yellen’s speech, traders cut their odds of a rate hike in September to 18 per cent from 21 per cent, and slightly raised the chances of a December hike to 43.1 per cent from 41.4 per cent, according to CME Group’s FedWatch tool.
Shares of Herbalife fell 4.7 per cent to $59.04 after a report said Carl Icahn, the nutritional supplement maker’s top shareholder, was looking to sell his stake.
Ulta Salon also fell 4.7 per cent and was the top percentage loser on the S&P 500 after giving a disappointing forecast for the current quarter.
Advancing issues outnumbered decliners on the NYSE by 2,110 to 682. On the Nasdaq, 1,781 issues rose and 807 fell.
The S&P 500 index showed 27 new 52-week highs and one new low, while the Nasdaq recorded 94 new highs and 12 new lows.
