By Carla Mozee, Victor Reklaitis and Anora Mahmudova,
MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks rallied on Wednesday, with
the S&P 500 and Dow Jones Industrial Average recording their
best one-day percentage gain in more than 5 weeks.
The rebound snapped a 3-day losing streak that has been blamed
in part on worries about global growth and fighting in Iraq and
Syria.
A stronger-than-expected report on new-home sales and dovish
comments from two Federal Reserve officials, may have contributed
to gains.
The S&P 500(SPX) gained 15.63 points, or 0.9%, to 1,998.38.
Broad-based gains were led by health care and consumer staples
sectors.
The Dow Jones Industrial Average(DJI) gained 155.02 points, or
0.9%, to 17,210.89, recovering some of the steep losses from the
previous two sessions.
Meanwhile, the tech-heavy Nasdaq Composite (RIXF) added 46.53
points, or 1.03%, to 4,555.22, while the small-cap Russell 2000
(RUT) -- which has lagged behind the other indexes this month and
this year -- gained 8.9 points, or 0.8%, to 1,127.60.
(Read more in Need To Know: Investors, media fixated on
imploding small-cap stocks
http://www.marketwatch.com/story/gold-10000-and-why-golden-is-worse-than-death-when-it-comes-to-crosses-2014-09-24.)
Trading rebound: Wednesday's early advance may have been more of
a trading rebound than anything else, said Colin Cieszynski, chief
market strategist at CMC Markets.
"Economic news flow has been light," he said in a note, adding
that "monetary policy direction (more dovish in Europe, more
hawkish in the US) hasn't really changed."
Today's key economic news: The Commerce Department said sales of
new single-family homes surged 18% in August to a seasonally
adjusted annual rate of 504,000, the fastest pace in more than six
years. Economists polled by MarketWatch had expected a sales rate
of 426,000.
Investors welcomed dovish remarks from two Fed officials. The
Federal Reserve should be "exceptionally patient" before hiking
short-term interest rates - even to the point of allowing a modest
overshoot of its inflation target, said Charles Evans, the
president of the Chicago Fed.
The economy is returning to more normal territory and the Fed is
prudently planning for the exit from its zero-rate policy stance,
said Loretta Mester, the president of the Cleveland Fed
Movers and shakers: Bed Bath & Beyond (BBBY) shares climbed
more than 7.4% to lead the S&P 500 after the home-furnishings
retailer late Tuesday posted better-than-expected quarterly
earnings.
KB Home (KBH) fell 5.30%, after the home builder reported fiscal
third-quarter profit and sales that fell well short of
expectations.
(Read more in the Movers & Shakers column
http://www.marketwatch.com/story/bed-bath-beyond-kb-home-jabil-likely-in-focus-2014-09-24.)
Other markets: Japan's Nikkei Average shed 0.2%. Meanwhile, the
dollar fell against the yen (USDJPY) after Japan's prime minister
said he's cautious about the yen's recent weakness.
European stocks mostly gained after initially wavering following
a sluggish reading on German business confidence. Gold futures
(GCZ4) dipped, and oil futures(CLX4) were slightly higher.
Subscribe to WSJ: http://online.wsj.com?mod=djnwires