Stocks rallied and the Dow hit an all-time high on Wednesday after Federal Reserve Chair Janet Yellen said the US economy was strong enough to absorb gradual rate increases over the next few years.
Here’s the scoreboard:
- Dow: 21,532.14, +123.07, (0.57%)
- S&P 500: 2,443.25, +17.72, (0.73%)
- Nasdaq: 6,261.17, +67.87, (1.10%)
- Yellen spent the morning in Congress. “Because we also anticipate that the factors that are currently holding down the neutral rate will diminish somewhat over time, additional gradual rate hikes are likely to be appropriate over the next few years to sustain the economic expansion and return inflation to our 2 per cent goal,” Yellen said in prepared remarks for her Humphrey-Hawkins testimony.
- The Bank of Canada raised rates for the first time in seven years. Data from the overnight index swaps market showed a nearly 80% chance of another hike by December, while Canada’s 2-year yield touched its highest since September 2014 at 1.172%.
- Amazon Prime Day on Tuesday was the largest ever, the company said, and it beat Black Friday and Cyber Monday. Amazon shares went back above $US1,000.
- Former Brazilian President Luiz Inacio Lula da Silva was convicted of corruption and sentenced to nearly 10 years in prison. A judge found him guilty of accepting bribes worth 3.7 million reais ($US1.2 million) from an engineering firm that refurbished his beach apartment in exchange for state contracts.