New York – Wall Street wobbled, then regained its stride Wednesday after the Federal Reserve told investors what they expected to hear: that inflation is still too high for comfort, but the central bank is holding interest rates steady. The Dow Jones industrials rose to another record close.
The central bank’s Open Market Committee as anticipated left interest rates unchanged at 5.25 percent, as it has done since last summer. The statement that accompanied the decision was little changed from the one the Fed released after its last meeting in March; the assessment said policymakers are keeping their inflation watch the priority despite a slower economy.
Though some investors were hoping the Fed would raise the possibility of a future rate cut, they weren’t surprised by the committee’s stance. Moreover, they were relieved to hear the Fed is not more inclined than it has been to raise rates, a move that would make access to capital more expensive.
Stocks drew support Wednesday from more takeover news, particularly speculation about a possible bid by mining company BHP Billiton Ltd. for rival Rio Tinto Group.
Investors also were pleased about a government report that showed that after three months of declines, the nation’s gasoline inventories rose last week. If they keep increasing, fuel costs for U.S. drivers are likely to ease.
The Dow Jones industrial average rose 53.80, or 0.40 percent, to 13,362.87, after reaching a new trading high of 13,369.29. It was the blue-chip index’s 21st record close since the beginning of the year.
The Standard & Poor’s 500 index advanced 4.86, or 0.32 percent, to 1,512.58 – a new 6 1/2-year high. The index is near its closing record of 1,527.46, reached March 24, 2000.
The Nasdaq composite index rose 4.59, or 0.18 percent, to 2,576.34.
