NEW YORK — Stocks posted solid gains Wednesday ahead of a closely watched decision by the Federal Reserve on whether to raise interest rates.
Beer companies gained on word of a possible deal between two giant brewers, and energy stocks rose sharply after a big jump in the price of oil.
The Dow Jones industrial average rose 140.10 points, or 0.84 percent, to 16,739.95, the Standard & Poor’s 500 index rose 17.22 points, or 0.9 percent, to 1,995.31 and the Nasdaq composite added 28.72 points, or 0.6 percent, to 4,889.24.
Investors for months have been speculating about when the Federal Reserve will raise interest rates. The Fed, which started its two-day policy meeting Wednesday, will announce its decision Thursday afternoon. The decision will be followed by a news conference by Fed Chair Janet Yellen.
“If they raise (Thursday), it’s going to be nasty for the stock market. Much of the rally back has had much to do with investors believing the Fed isn’t going to move,” said Tom di Galoma, head of fixed income rates trading at ED&F Man Capital.
In company news, SABMiller, a major beermaker whose brands include Miller and Foster’s, jumped 20 percent in London after the company said it received a takeover offer from Anheuser-Busch InBev of Belgium. A combination of the two would create a massive conglomerate worth $275 billion. Any potential deal would be heavily scrutinized by regulators.
U.S.-traded shares of AB InBev rose $7.39, or 7 percent, to $115.43. Other beermakers also rose. Molson Coors jumped $10.34, or 14 percent, to $82.98.
Energy stocks also rose after a steeper-than-expected drop in crude inventories sent oil prices sharply higher.
U.S. benchmark crude jumped $2.56, or 5.7 percent, to $47.15 a barrel on the New York Mercantile Exchange. Brent crude, a benchmark for many international types of oil imported into the U.S., gained $2, or 4.2 percent, to $49.75 a barrel in London.
The Energy Information Administration said U.S. oil supplies fell last week by a steeper-than-expected 2.2 million barrels. Analysts surveyed by Platts expected a decline of 200,000 barrels. The plunge follows news that oil drillers in the U.S. are cutting production in the face of low oil prices.
Oil company stocks followed crude oil higher. The energy sector of the S&P 500 shot up 2.8 percent, more than twice as much as the rest of the market.
