U.S. stocks closed with gains for the fifth consecutive day Wednesday on its way to total recovery from the losses it suffered one week ago. High-dividend stocks rose and banks and bond yields weakened as the Federal Reserve gave more signs it will start reducing its huge portfolio of bonds later this year.
ON WALL STREET: At the close, the Standard & Poor’s 500 index was up nearly 6 points, about 0.3 percent, at 2,404.4. The Dow Jones industrial average gained 74.5 points, about 0.4 percent, to 21,012.4. The Nasdaq composite rose 24.3 points, about 0.4 percent, to 6,163. The Russell 2000 index of small-company stocks added 1.5 points, about 0.1 percent, to 1,382.5.
While stocks are moving higher, the gains continue to get smaller as investors hesitated to blow past the market’s previous records.
THE FED: The Federal Reserve released the minutes from its meeting earlier this month. Officials discussed steps for shrinking the central bank’s $4.5 trillion in bond holdings. The Fed bought huge amounts of bonds during the global economic crisis in an effort to stimulate the economy. When the Fed suggested in April that it was considering such a move, investors were jolted.
BONDS: Bond prices rose. The yield on the 10-year Treasury note fell to 2.266 percent from 2.28 percent. Banks traded a bit lower as a result, as lower bond yields mean lower interest rates and reduced profits on lending. High-dividend companies including real estate investment trusts and utilities traded higher as investors looked for yield.
OIL PRICES: Benchmark U.S. crude lost 15 cents to settle at $51.32 per barrel on the New York Mercantile Exchange. In London on the Intercontinental Exchange Europe, Brent crude, used to price international oils, sank 23 cents to $53.92 a barrel. Oil prices have rallied lately as members of the OPEC cartel and other countries prepare to meet and discuss production. Those nations are expected to extend last year’s production cut in a concerted attempt to prevent oil prices from falling.