The Dow Jones Industrial Average reached a milestone by closing above 45,000 for the first time on Wednesday, while both the S&P 500 and Nasdaq Composite continued their upward trajectories as markets processed the latest commentary from Federal Reserve Chair Jerome Powell. On the day, the Dow increased by 0.7% to finish at 45,014.
The Nasdaq, heavily weighted in technology stocks, surged 1.3% to 19,735.1, while the S&P 500 climbed 0.6% to 6,086.5. The technology sector demonstrated the most significant growth, while energy faced the most considerable downturn. Powell remarked that the current US economy is performing better than perceived in September when the Federal Open Market Committee began its monetary policy easing, suggesting that the FOMC may adopt a more cautious approach in future interest rate reductions.
"We can afford to be a little more cautious as we try to find neutral," he stated. In separate comments, St. Louis Fed President Alberto Musalem indicated that US inflation is projected to return to the FOMC's long-term target of 2%, adding that moderating the current monetary policy towards neutrality will be suitable over time. The US two-year treasury yield dropped by 4.3 basis points to 4.13%, while the 10-year yield decreased by 3.3 basis points to 4.19%. On the economic front, the US services sector showed continued expansion in November, with the Institute for Supply Management's data reflecting a slower sequential growth rate.
Conversely, S&P Global pointed to an acceleration in services activities. "The (ISM survey) result does not influence our outlook for continued expansion in consumer spending, particularly on the services side, which will keep the economy humming along," noted Oxford Economics. In the private sector, employment growth fell short of Wall Street estimates for November, although wage growth for those remaining in their jobs experienced its first rise in over two years, as reported by Automatic Data Processing. Most Federal Reserve districts noted a slight uptick in economic activity, with the growth outlook improving moderately across various geographies and sectors, corroborated by the latest Beige Book released on Wednesday. In the corporate landscape, shares of Salesforce surged nearly 11%, marking the highest performance on both the S&P 500 and the Dow.
The customer relationship management group's fiscal third-quarter revenue exceeded Wall Street's expectations, primarily driven by increased subscription and support sales. Marvell Technology distinguished itself as the top gainer on the Nasdaq, soaring 23%. The semiconductor solutions provider recently released an optimistic fiscal fourth-quarter earnings outlook, building on robust results from the previous quarter. On the downside, Texas Pacific Land saw a 12% decline in its share value, the steepest drop within the S&P 500. Foot Locker faced challenges, cutting its full-year earnings guidance and revealing disappointing fiscal third-quarter results amid weak consumer spending and promotional pressures, which sent its shares down by 8.9%. West Texas Intermediate crude oil prices decreased by 1.6% to $68.84 a barrel on Wednesday.
The Organization of the Petroleum Exporting Countries (OPEC) and associated allies are anticipated to postpone a planned production increase due to ongoing weak demand and concerns over oversupply. In precious metals, gold rose 0.2% to $2,674.20 per troy ounce, while silver increased by 1.1% to $31.84 per ounce..