Federal Reserve Chair Jerome Powell’s uncertainty over whether policy makers have raised rates enough didn’t stand in the way of a rally for both stocks and bonds on Wednesday.
On Wednesday, Powell said policy makers were asking themselves whether they had hiked enough, and said they weren’t confident rates were yet restrictive enough. That means the Fed is going to take it meeting by meeting, weighing the data as it decides whether it needs to make another move. While stocks fluctuated over the course of Powell’s news conference, major indexes ended the day with solid to strong gains. The Dow Jones Industrial Average DJIA rose over 220 points, or 0.7%, while the S&P 500 SPX advanced 1.1% and the Nasdaq Composite COMP jumped 1.6%.
Treasury yields extended a pullback, aiding the stock-market rally. The 10-year Treasury yield BX:TMUBMUSD10Y fell 8.4 basis points to 4.79%, while the 2-year yield BX:TMUBMUSD02Y fell back below 5%.