U.S. stocks closed more than half a percent higher Wednesday as investors eyed a jump in oil prices and looked ahead to the Federal Reserve’s decision on a rate hike. ()
“It’s all about waiting for tomorrow. Right now you’re seeing the market being positive. The consensus is the Fed is not going to do anything,” said Jeff Carbone, co-founder and managing partner of Cornerstone Financial Partners.
The Dow Jones industrial average closed about 140 points higher, after adding as much as 156 points in the minutes before the close.led the index higher.
The energy sector ended 2.77 percent higher, to lead S&P advancers.
The S&P 500 broke resistance at 1,993 and ended within 5 points of the psychologically key 2,000 level.
The Dow ended above its recent closing high hit Aug. 28, which means “we’re going to rally into the 50-day moving average,” said Adam Sarhan, CEO of Sarhan Capital.
In the last few weeks, both the Dow and the S&P formed the so-called death cross in which the 50-day moving average falls below the 200-day.
Gains in oil “should cushion any declines in the market today,” said Peter Cardillo, chief market economist at Rockwell Global Capital. He also noted options expirations Friday and short covering ahead of the Fed’s Thursday announcement.
Weekly crude oil inventories unexpectedly fell, supporting further gains in oil prices. Crude surged more than 5.5 percent, while brent was briefly up more than 7 percent above $50 a barrel.
Crude oil futures for October delivery settled up 5.7 percent at $47.16 a barrel. Gold futures ended up $16.40, to $1,110.90 an ounce, their highest level since last week.
The Federal Open Market Committee could raise short-term interest rates for the first time in nine years at its two-day meeting that began Wednesday. All eyes are on Thursday afternoon’s expected statement and press conference.
“You don’t have a market-moving piece of news in this market that seems to have come into today in a bit of equilibrium,” Art Hogan, chief market strategist at Wunderlich Securities, said of the opening stock index moves. “I think it tells us nobody has an idea what the Fed is going to do tomorrow.
In morning trade, the Dow briefly turned negative and tried to stay with the S&P 500 in positive territory. The Nasdaq composite also reversed slight losses to trade mildly higher.