New York – Stocks advanced Wednesday in light trading as Wall Street recovered from the previous session’s sell-off and awaited today’s expected interest-rate hike from the Federal Reserve.
Traders were still nervous after the Dow Jones industrial average lost more than 120 points Tuesday on a sell-off fueled by worries about the Fed’s pending interest-rate decision and its accompanying policy statement.
The Fed is expected to announce at least a quarter-point rate hike, which would bring short-term interest rates to 5.25 percent, but a few economists expect a bolder half-point increase. Any increase would be the 17th consecutive rate hike since the Fed began to tighten credit in 2004.
There was little corporate or economic news to guide traders. J. Crew’s initial public offering at a higher-than-expected price and its subsequent run-up provided a scrap of cheer. The preppy retailer’s offering was the third-largest retail IPO ever.
Stocks have barely budged for the year despite an early run-up and, more recently, a nearly two-month slide.
“If you’re a long-term investor, I don’t think there’s been anything interesting to talk about in 2006; if you’re a short-term trader, it’s been painful,” said Stephen Wood, portfolio strategist at Russell Investment Group.
The Dow rose 48.82, or 0.45 percent, to 10,973.56. The Dow plunged 120.54 on Tuesday.
Broader stock indicators also closed higher. The Standard & Poor’s 500 index was up 6.80, or 0.55 percent, at 1,246.00, and the Nasdaq composite index rose 11.59, or 0.55 percent, to 2,111.84.
An index of Colorado stocks rose, led by Penford Corp., Whiting Petroleum Corp. and Wild Oats Markets Inc.
The Bloomberg Colorado Index, a price-weighted list of companies based in the state, rose 0.81, or 0.2 percent, to 333.52. Advancing stocks outnumbered those that declined 63 to 43, with five unchanged.
