Wall St. closes higher after Fed vows more support for the virus-battered economy

July 29 , 2020 2:14 AM
New York (Reuters) - U.S. stocks closed higher on Wednesday, adding to gains after the Federal Reserve repeated a pledge to use its “full range of tools” to support the economy but cautioned that the outlook “will depend significantly on the course of the virus.”

At the end of its two-day policy meeting the Fed said it will keep its interest rate target range until it is confident the economy has weathered the coronavirus pandemic and is on track for maximum employment and price stability goals.

While strategists said they found no surprising decisions after the meeting, many pointed out that the Fed’s focus on the virus highlighted the uncertainties it faces.

“The Fed is putting health again front and center in its statement, which is impactful and meaningful, especially when we’re waiting on a bipartisan agreement on the fifth round of the CARES Act. It’s a bit ominous, to be frank,” said Nela Richardson, investment strategist at St. Louis-based Edward Jones.

But Richardson noted the “commitment to do whatever it takes to get the economy going again” and a recognition the economy has improved and “come up from the bottom.”

And with Fed confirmation of an extraordinarily uncertain path, “investors can feel certain that monetary stimulus is going to remain accommodative for the foreseeable future,” said Shawn Snyder, head of investment strategy at Citi Personal Wealth Management.

The Dow Jones Industrial Average .DJI rose 160.29 points, or 0.61%, to 26,539.57, the S&P 500 .SPX gained 40 points, or 1.24%, to 3,258.44 and the Nasdaq Composite .IXIC added 140.85 points, or 1.35%, to 10,542.94.