Investing.com -- U.S. stocks rose sharply on Wednesday, remaining near 2016-yearly highs as longstanding fears of excessive tightening by the Federal Reserve continued to recede following extremely dovish comments from Janet Yellen at a closely-watched speech.
The major indices continued their dramatic rally from January's major downturn, reaching new calendar year highs in Wednesday's session with one day left in the first quarter. While speaking in front of a luncheon at the Economic Club of New York on Tuesday, Yellen reiterated that she expects the Fed to maintain a cautious stance on future rate hikes in the coming years. Any rate hikes by the Fed this year are viewed as bearish for equities, as investors pile into lower risk U.S. Treasuries and other bonds in an effort to capitalize on higher yields.
The Dow Jones Industrial Average gained 83.76 or 0.48% to 17,716.87, while the NASDAQ Composite index added 22.67 or 0.47% to 4,869.26, amid strong performances in software and internet stocks. The S&P 500 Composite index, meanwhile, rose 8.94 or 0.44% to 4,869.26, as seven of 10 sectors closed in the green. Stocks in the Basic Materials, Technology and Consumer Services industries led, each gaining more than 0.5% on the session. Both the Dow and S&P 500 are up more than 10% from their February lows.
The Financial sector also received a boost from a court ruling on Wednesday when a U.S. federal judge in Washington struck down a regulators' designation that MetLife Inc (NYSE:MET) should be considered a Systemically Important Financial Institution (SIFI), paving the way for other top insurers to fight regulations set forth in the landmark 2010 Dodd-Frank law. Companies which have received a SIFI designation can be subject to higher risk-based and leverage capital requirements.
The top performer on the Dow was Visa Inc (NYSE:V), which added 1.43 or 1.90% to 76.81. Earlier this week, Citigroup Inc (NYSE:C) released details of Costco (NASDAQ:COST)'s new rewards program with the credit card giant, which is scheduled to launch in late-June. As part of the program, customers can earn up to 2% on all Costco purchases and up to 4% on up to $7,000 in gas payments. The worst performer was Boeing Company (NYSE:BA), which fell 2.31 or 1.76% to 128.57 after the Everett, Washington based company announced plans to eliminate roughly 4,000 positions from its commercial aircraft division by the middle of this year.
"While there is no employment reduction target, the more we can control costs as a whole the less impact there will be to employment," Boeing (NYSE:BA) spokesman Doug Alder said in a statement.
The biggest gainer on the NASDAQ was Jd.Com Inc Adr (NASDAQ:JD), which added 0.82 or 3.10% to 27.24. Shares in the Chinese e-commerce site are still down roughly 12% this year. The worst performer was Western Digital Corporation (NASDAQ:WDC), which lost 2.18 or 4.51% to 46.14. Shares in Western Digital (NASDAQ:WDC), fell back one day after the computer data storage company announced that it is offering higher yields on $5.6 billion in junk bond sales. The offerings include $1.5 billion in senior secured notes due in 2023 and $4.1 billion in senior unsecured notes due in 2024.
The top performer on the S&P 500 was Royal Caribbean Cruises Ltd (NYSE:RCL), which jumped 4.30 or 5.65% to after chief competitor Carnival PLC (NYSE:CCL) nearly tripled profits in the first quarter due primarily to lower fuel costs. Carnival (LON:CCL), which topped analysts' earnings and revenues forecast, surged 5.50% to 52.37. Western Digital was also the worst performer on the S&P 500, just below Southwestern Energy Company (NYSE:SWN), which fell 0.30 or 3.75% to 7.70.
On the New York Stock Exchange, advancing issues outnumbered declining ones by a 1,956-1,104 margin.