U.S. stocks rose on Wednesday, a day after Federal Reserve Chair Janet Yellen's comments eased some concerns about the path of interest rate hikes, but gains were limited by a dip in crude oil prices.
Oil prices retreated from their day's highs after a report showed a weekly build in U.S. crude inventories.
Yellen, in her first remarks since the Fed held steady on rates earlier this month, said the central bank should tread cautiously on raising rates this year.
Yellen's stance contrasts with recent comments from other policymakers who have voiced support for more than one increase this year.
Markets around the world cheered Yellen's remarks, which suggested that a rate hike was not immediately on the horizon. The dollar fell more than a percent, while bond prices rallied.
The rally was driven by Yellen's comments but the upcoming corporate earnings season would be the real test for stocks, said Ernie Cecilia, chief investment officer of Bryn Mawr Trust in Devon, Pennsylvania.
"In order to sustain the strength in the equity market, you're going to have to see some decent earnings growth at some point," Cecilia said.
Declining earnings growth has been a major factor for stocks as a sputtering global economy weighs on balance sheets.
Data by payrolls processor ADP on Wednesday showed the U.S. private sector added more jobs than expected in March, indicating continued improvement in the U.S. labor market.
The report is a precursor to the more comprehensive non-farm payrolls data on Friday.
At 12:34 p.m. ET (1634 GMT), the Dow Jones industrial average was up 84.99 points, or 0.48 percent, at 17,718.1, the S&P 500 was up 9.87 points, or 0.48 percent, at 2,064.88 and the Nasdaq Composite index was up 22.35 points, or 0.46 percent, at 4,868.98.
All 10 major S&P sectors were higher, led by a 0.87 percent rise in the financial sector. Metlife gave the sector its biggest boost.
Metlife's shares were up 5 percent at $44.57 after a court ruled that the life insurer was not systemically important to the country's financial system. The tag "too big to fail" would have brought the company under more stringent regulations.
Fellow insurers AIG and Prudential Financial were up more than 2 percent.
Apple was up 1.4 percent at $109.16 after Cowen raised its rating on the stock to "outperform". The stock gave the biggest boost to the S&P 500 and the Nasdaq.
Advancing issues outnumbered decliners on the NYSE by 2,000 to 982. On the Nasdaq, 1,771 issues rose and 925 fell.
The S&P 500 index showed 53 new 52-week highs and no new lows, while the Nasdaq recorded 67 new highs and 16 new lows.
(Reporting by Yashaswini Swamynathan and Abhiram Nandakumar; Editing by Saumyadeb Chakrabarty)
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Published Date: Mar 30, 2016 23:30 PM | Updated Date: Mar 30, 2016 23:30 PM