Investing.com - U.S. stocks closed sharply higher Wednesday, posting the strongest rally of the year, amid growing hopes for further stimulus measures by the Federal Reserve, while comments from European Central Bank President Mario Draghi kept the possibility open of further action should the economy deteriorate.
At the close of U.S. trade, the Dow Jones Industrial Average climbed 2.37%, the S&P 500 index jumped 2.25%, while the Nasdaq Composite index gained 2.40%.
Draghi stated the ECB stands ready to help support the economy should things deteriorate in the euro zone helping to support stocks.
The ECB president went on to say the central bank would extend its policy of lending to banks until mid-January 2013 but didn't announce any new three-year lending operations, disappointing expectations for fresh easing measures to stabilize markets.
Earlier Wednesday, the ECB left euro zone interest rates unchanged at 1%, in a widely expected decision.
The decision came one day after Spain warned that it was having difficulty accessing credit markets, while uncertainty over the outcome of Greek elections on June 17 also weighed.
Investors shifted their attention to a Congressional testimony by Federal Reserve Chairman Ben Bernanke on Thursday about the state of the U.S. economy. The Wall Street Journal, citing interviews and Fed speeches, reported late Tuesday that the U.S. central bank is mulling new measures to stimulate growth in the world’s largest economy.
Charles Evans, president of the Chicago Federal Reserve Bank called earlier for aggressive policy easing in the U.S., citing the recent run of "soft" economic data.
Financial stocks were broadly higher, led by Bank of America, up 1.69%, and closely followed by Citigroup, whose shares climbed 1.51%, while JP Morgan and Goldman Sachs advanced 1.63% and 1.19% respectively.
Energy companies also contributed to gains, as Chevron rallied 1.32% and Exxon Mobil rose 0.95%, while ConocoPhillips surged 1.29% on the back of rising crude oil prices.
Chesapeake Energy also surged 4.06% amid reports the oil and gas giant is in advanced talks to sell pipelines to Global Infrastructure Partners for more than USD4 billion.
Meanwhile, shares in General Motors were up 1.13%, after Reuters reported that the company’s struggling European unit Opel emerged from its worst-ever sales crisis in Germany and now expects to gradually expand its slice of the market back into the double digits, a level not seen since 2005.
On the downside, Facebook saw shares tumble 2.31%, after JMP Securities started coverage of the social-networking giant with a "market outperform" rating and a USD37 price target.
The social media giant was also said to be facilitating advertisers’ access to the growing ranks of users on smartphones and mobile devices, taking a significant step toward addressing one of investors' most pressing concerns and broadening its appeal to marketers.
Elsewhere, mattress maker Tempur-Pedic dove 42.18% after slashing its full-year earnings and revenue outlook due to increasing competition in North America.
The news came after rival Mattress Firm missed revenue expectations on Tuesday and handed in weak quarterly revenue estimates. Shares in Mattress Firm were down 18.13% on Wednesday.
In addition Wednesday, official data showed that German industrial production dropped 2.2% in April, compared to expectations for a more modest 1.0% decline, fuelling concerns over the impact of the ongoing sovereign debt crisis on the region’s largest economy.
At the close of European trade, the EURO STOXX 50 surged 2.42%, France’s CAC 40 jumped 2.42%, while Germany’s DAX 30 rallied 2.09%.
Investors are awaiting Ben Bernanke’s testimony, U.S. initial jobless claims, as well as Great Britain’s interest rate decision on Thursday.
At the close of U.S. trade, the Dow Jones Industrial Average climbed 2.37%, the S&P 500 index jumped 2.25%, while the Nasdaq Composite index gained 2.40%.
Draghi stated the ECB stands ready to help support the economy should things deteriorate in the euro zone helping to support stocks.
The ECB president went on to say the central bank would extend its policy of lending to banks until mid-January 2013 but didn't announce any new three-year lending operations, disappointing expectations for fresh easing measures to stabilize markets.
Earlier Wednesday, the ECB left euro zone interest rates unchanged at 1%, in a widely expected decision.
The decision came one day after Spain warned that it was having difficulty accessing credit markets, while uncertainty over the outcome of Greek elections on June 17 also weighed.
Investors shifted their attention to a Congressional testimony by Federal Reserve Chairman Ben Bernanke on Thursday about the state of the U.S. economy. The Wall Street Journal, citing interviews and Fed speeches, reported late Tuesday that the U.S. central bank is mulling new measures to stimulate growth in the world’s largest economy.
Charles Evans, president of the Chicago Federal Reserve Bank called earlier for aggressive policy easing in the U.S., citing the recent run of "soft" economic data.
Financial stocks were broadly higher, led by Bank of America, up 1.69%, and closely followed by Citigroup, whose shares climbed 1.51%, while JP Morgan and Goldman Sachs advanced 1.63% and 1.19% respectively.
Energy companies also contributed to gains, as Chevron rallied 1.32% and Exxon Mobil rose 0.95%, while ConocoPhillips surged 1.29% on the back of rising crude oil prices.
Chesapeake Energy also surged 4.06% amid reports the oil and gas giant is in advanced talks to sell pipelines to Global Infrastructure Partners for more than USD4 billion.
Meanwhile, shares in General Motors were up 1.13%, after Reuters reported that the company’s struggling European unit Opel emerged from its worst-ever sales crisis in Germany and now expects to gradually expand its slice of the market back into the double digits, a level not seen since 2005.
On the downside, Facebook saw shares tumble 2.31%, after JMP Securities started coverage of the social-networking giant with a "market outperform" rating and a USD37 price target.
The social media giant was also said to be facilitating advertisers’ access to the growing ranks of users on smartphones and mobile devices, taking a significant step toward addressing one of investors' most pressing concerns and broadening its appeal to marketers.
Elsewhere, mattress maker Tempur-Pedic dove 42.18% after slashing its full-year earnings and revenue outlook due to increasing competition in North America.
The news came after rival Mattress Firm missed revenue expectations on Tuesday and handed in weak quarterly revenue estimates. Shares in Mattress Firm were down 18.13% on Wednesday.
In addition Wednesday, official data showed that German industrial production dropped 2.2% in April, compared to expectations for a more modest 1.0% decline, fuelling concerns over the impact of the ongoing sovereign debt crisis on the region’s largest economy.
At the close of European trade, the EURO STOXX 50 surged 2.42%, France’s CAC 40 jumped 2.42%, while Germany’s DAX 30 rallied 2.09%.
Investors are awaiting Ben Bernanke’s testimony, U.S. initial jobless claims, as well as Great Britain’s interest rate decision on Thursday.