Investing.com – U.S. stocks closed higher on Wednesday, as financials, mostly banks, surged on the back of rising expectations that the release of the Federal Reserve’s stress test results will show that several big banks are in strong financial health.
A surge in financials spurred a rally in the broader market, as investors piled into banking stocks amid expectations that upbeat Federal Reserve stress test results would encourage several banks to ramp up dividends to shareholders.
Shares of JPMorgan and Goldman Sachs both closed more than 1% higher.
On the economic data front, pending home sales fell for the third-straight month, as the tighter supply of U.S. homes continued to push prices higher, deterring prospective buyers.
Meanwhile, the two-day tech selloff was halted on Wednesday, as shares of Facebook, Apple, and Amazon rebounded, paring losses of more than 1.5% sustained in the previous session.
The positive day for U.S. equities comes amid growing doubts that President Trump may struggle to deliver on his pro-growth economic agenda, which includes tax reform, after the Senate’s decision to delay a vote on a healthcare bill.
President Donald Trump has reiterated several times that healthcare reform would need to passed before his administration moves ahead with tax reform, which is widely viewed as a pro-economic growth measure.
In corporate news, Amazon become the latest company to catch the attention of President Trump, who tweeted that Amazon (NASDAQ:AMZN) wasn’t “paying internet taxes (which they should). Shares of Amazon closed 1.39% higher.
The Dow Jones Industrial Average closed at 21,454.61. The S&P 500 closed 0.88% higher while the Nasdaq Composite closed at 6234.41, up 1.43%.
The ‘Bulls and Bears’ on Wall Street
The top Dow gainers for the session: Caterpillar Inc (NYSE:CAT) up 2.4%, JPMorgan Chase & Co (NYSE:JPM) up 2%, while Intel Corporation (NASDAQ:INTC) rose 1.6%.
Johnson & Johnson (NYSE:JNJ) down 0.9%, Merck & Company Inc (NYSE:MRK) down 0.6% and General Electric Company (NYSE:GE) down 0.5%, were among the worst Dow performers of the session.