Stocks rise with eye on the Fed
NEW YORK - It's all about the Fed. Still. U.S. stocks moved higher Tuesday, helped by news of low inflation and a pickup in home building. But the Federal Reserve loomed large, with investors trying to guess what the central bank will say Wednesday about how long it plans to keep stimulus programs in place.
NEW YORK - It's all about the Fed. Still.
U.S. stocks moved higher Tuesday, helped by news of low inflation and a pickup in home building. But the Federal Reserve loomed large, with investors trying to guess what the central bank will say Wednesday about how long it plans to keep stimulus programs in place.
The Standard & Poor's 500 index rose 12.77 points, or 0.8 percent, to 1,651.81. All 10 of its sectors rose, led by industrial and telecommunications companies.
The Dow Jones industrial average rose 138.38 points, or 0.9 percent, to 15,318.23. The Nasdaq composite index rose 30.05 points, or 0.9 percent, to 3,482.18.
The Russell 2000, an index of smaller companies, rose 12.15 points, or 1.2 percent, to 999.99, the closest it has ever come to breaking 1,000.
Tuesday's wait-and-see vibe was familiar. The Fed has had an outsize effect on the stock market in recent weeks, with the major indexes yanked back and forth as investors try to guess how long the central bank will support the economy.
Brian Doe of Gratus Capital, in Atlanta described the Fed's announcements as "the big wind" that could push the market around. "Right now the wind is not blowing," he said. "We have this little calm where everybody can be optimistic."
The Commerce Department reported Tuesday that the pace of home building increased in May, helped by more buyers coming to the market and a scarcity of houses for sale. Investors described the report as good enough to send the market up, but not good enough to force the Fed to start thinking that the economy is fine and abruptly slash its stimulus efforts.
The Labor Department reported that U.S. consumer prices rose last month, but only slightly. If inflation is in check, it gives the Fed more leeway to continue the stimulus programs.
Among stocks making moves, Hormel Foods, maker of Skippy peanut butter and Spam, slipped after it said it expected lower profits for the year. The stock fell $1.46, or 3.6 percent, to $39.19.
Jack in the Box rose after announcing it will close some of the Qdoba Mexican Grill restaurants it owns. Shares gained $1.82, or 4.9 percent, to $38.81.
Signet Jewelers, which runs Kay Jewelers and Jared, rose after saying it plans to buy back up to $350 million of its own stock. Signet rose $1.94, or 2.9 percent, to $69.91.