Market Closes Higher on Hopes for Fed’s Next Move

Market Closes Higher on Hopes for Fed’s Next Move

The stock market moved broadly higher on Tuesday as investors appeared optimistic about the outcome of the Federal Reserve’s policy-making meeting and the prospect for interest rates.

All 10 industry sectors in the Standard & Poor’s 500-stock index rose, led by health care, utilities and energy companies.

“The economy continues to improve in the U.S., and there’s still an accommodative Fed,” said Brad Sorensen, director of market and sector research at the Schwab Center for Financial Research. “We think the bull market has further to run.”

The Fed has held a crucial short-term interest rate close to zero for over five years, making it cheaper for companies and consumers to borrow and bolstering corporate profits. The stock market has surged as a result. But investors widely expect the Fed to start raising its overnight rate in the middle of next year.

Investors may get a better sense of how soon after the central bank concludes its two-day meeting on Wednesday. The Fed’s chairwoman, Janet L. Yellen, may discuss the bank’s plans for interest rates, as well as the outlook for employment and inflation, at a news conference in the afternoon.


            The Dow Minute by Minute       

            Position of the Dow Jones industrial average at 1-minute intervals yesterday.       




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2 p.m.

4 p.m.

Jonathan D. Corpina, senior managing partner at Meridian Equity Partners, said there was lot of talk among traders during the day about what the Fed might do, but little new insight.

“There’s a lot of chatter, but nothing that’s real,” he said.

Until the last few minutes, the Dow Jones industrial average looked as if it would close at a new nominal high, but it slipped back at the end. Still the blue-chip index ended up gaining 100.83, its first triple-digit close since Aug. 18. The Dow closed at 17,131.97, a gain of 0.6 percent.

The Nasdaq composite index rose 33.86 points, or 0.8 percent, to 4,552.76. The S.&P. 500 climbed 14.85 points, or 0.8 percent, to 1,998.98.

Among the 10 sectors of the S.&P. 500, health care stocks gained the most, up 1.3 percent. Utilities and energy stocks followed, with a 1.2 percent gain each. Energy stocks were pushed higher by rising oil prices. Crude oil for November delivery rose $1.82 to settle at $93.81 a barrel on the New York Mercantile Exchange. Exxon Mobil gained $1.14, or 1.2 percent, to $97.43.

In economic news, a measure of prices that American producers receive for their goods and services was unchanged in August, the latest sign that inflation is in check. A drop in wholesale gas and food prices was offset by higher prices for transportation and shipping services, the Labor Department said.

Among the stocks on the move, the health insurer Humana rose $4.71, or 3.7 percent, to $132.37 after it said it planned to repurchase as much as $2 billion of its own shares, double what it had previously planned. The stock has climbed 28 percent this year.

Sears Holdings fell $3.15, or 9.4 percent, to $30.37. The company is taking out a $400 million short-term loan from a hedge fund run by Edward Lampert, the company’s chief executive and biggest shareholder. Sears has struggled against rivals like Walmart Stores in recent years.

The yield on the 10-year Treasury note was unchanged from Monday at 2.59 percent. Its price slipped 1/32, to 98 3/32.