But it was music to investors' ears. The NASDAQ Composite surged 0.75%, hitting new closing and intraday highs. The S&P 500 jumped at the open, briefly topping 3,300 for the first time before dropping back to a 0.45% gain and just under its July 3 close of 2,995.82 The Dow Jones industrials added 0.3%, also reaching a new intraday high of 26,983, up 200 points from the day before. But then the blue chips slid back.
The stock rally was accompanied by a 4.5% jump in oil prices, which was partly due to worries that storms in the Gulf of Mexico will shut down offshore production wells. The Gulf produces about 17% of U.S. crude oil. West Texas Intermediate crude, the benchmark U.S. oil, finished up $2.60 to $60.43 a barrel. Brent crude, the global benchmark, added $2.85 to $67.01. WTI is up 33% this year, while Brent is up nearly 25%.
Gold, meanwhile, moved solidly above $1,400 an ounce, finishing at $1,212.50 an ounce, and palladium shot up toward $1,600 an ounce.
But the big question of the day was if the Fed believes it needs to cut interest rates. And Powell offered many reasons that seemed to suggest a rate cut is coming at its July 30-31 meeting. Investing.com's Fed Rate Monitoring tool suggests the Fed will cut its key federal funds rate to 2%-2.25% from 2.25-2.5%. And maybe another rate cut in the fall.
Rates have been coming down as global economic worries -- most prominently the U.S.-China trade dispute and tensions in the Middle East -- grabbed investor attention. But Wednesday, longer term rates were higher. The 10-year Treasury yield moved up to 2.07% from 2.06% as investors shed bonds for stocks. The 10-year yield is still off 23% this year.