S&P 500 gains for the first day in four after Powell signals smaller rate hikes

Fed Chair Jerome Powell said during his remarks Wednesday that chilling interest rate hikes will help balance management risks.

“We have a risk management balance to strike,” he said. “We think that slowing down at this point is a good way to balance the risks.”

— Alex Harring

The S&P 500 continued its ascent Wednesday on the heels of Fed Chair Jerome Powell’s remarks, reaching more than 1% up despite trading down earlier in the day.

The broad index was up 1.3% around 2 p.m.

Meanwhile, the tech-heavy Nasdaq Composite was up more than 240 points, or 2.2%, around the same time.

— Alex Harring

Fed Chair Jerome Powell’s comments indicating the central bank will slow future interest rate hikes as soon as December put upward pressure on the three major indexes.

The S&P 500 jumped up 0.6% from the red on the news.

The Dow was near flat after trading down for most of the day.

The Nasdaq Composite gained steam to 1.3% up.

— Alex Harring

Federal Reserve chairman Jerome Powell told an audience at the Brookings Institution Wednesday that the central bank can afford to ease back on its tighter monetary policy at its December meeting (due to wrap up Dec. 14).

The lagged effect of higher rates already taken in 2022, plus the drawing down of the size of the Fed’s balance sheet through quantitative tightening, mean “it makes sense to moderate the pace of our rate increases as we approach the level of restraint that will be sufficient to bring inflation down,” Powell said.

“The time for moderating the pace of rate increases may come as soon as the December meeting,” said the 69-year-old Fed chair.

In response to Powell’s remarks, the S&P 500 quickly gained to about 3970 vs about 3950 before the address.

— Scott Schnipper, Jeff Cox

These are the companies making the biggest moves midday:

CrowdStrike — Shares dropped 19% after the cybersecurity provider said new revenue growth is weaker than expected. The company did beat estimates on the top and bottom lines in its most recent quarterly results. Stifel downgraded the stock to hold from buy after the earnings report.

Horizon Therapeutics — The pharmaceutical company’s shares soared 26% after Horizon said it was in preliminary talks about a possible sale with several large pharma companies, including Amgen, Sanofi and Johnson & Johnson’s Janssen Global Services unit.

Petco — Shares of Petco jumped 12% after reporting third-quarter revenue that was slightly above Wall Street estimates. The pet product retailer’s comparable store sales rose 4.1%, above a StreetAccount estimate of 3.5%. Its adjusted EPS was in-line with expectations.

See the full list here.

— Tanaya Macheel

The S&P 500 is showing signs of stalling in its 200-day average short of recovery objectives, but strength is a corrective, according to Credit Suisse.

Analyst David Sneddon said the firm maintains its view that October brought a bear market rally. He said he’s now looking for a break below the 3,906-3,907 point mark to establish what he called a “double top.”

The current 200-day average sits at 4,052.

Indexes were down as investors looked to the second half of the trading day.

The Dow was down 0.8%. It was followed by the S&P 500, which has lost 0.5%.

Meanwhile, the Nasdaq Composite shed 0.1% despite trading up for much of the day.

Morning trading was driven by mixed economic data, but observers expect many investors are awaiting Fed Chair Jerome Powell’s speech at 1:30 p.m.

— Alex Harring

Despite mixed trading for the final day in November, the three major indexes remain poised to end the month positively.

The Dow was on pace to end the month up slightly under 3%. The S&P 500 is poised to add 2.1%.

Lagging behind the other two, the Nasdaq Composite is on track to end November 0.3% higher.

— Alex Harring

BlackRock’s Tony DeSpirito views healthcare as a “superior” area of the market to invest in, highlighting the sector’s reasonable valuation and long-term growth trajectory at an event Wednesday in New York City.

While the chief investment officer of U.S. fundamental equities also sees opportunities in utilities and staples, he views healthcare earnings as slightly more reasonable, trading at a roughly 10% discount to the market.

“You get better long-term growth, better recession resiliency, and you got a better valuation,” DeSpirito said, noting the sector is a large overweight in a slew of BlackRock’s funds.

The sector should also benefit from the aging population, given that…