U.S. stocks on Wednesday climbed for a third session after U.S. industrial production rose more than projected, Yahoo’s earnings topped estimates and Federal Reserve Chair Janet Yellen reiterated the central bank would keep up its backing of the recovery.
Stocks held most of their gains as Federal Reserve Chair Janet Yellen addressed the Economic Club of New York Wednesday afternoon and after the release of the Fed’s Beige Book, which found the U.S. economy bounced back from weather-related declines in recent weeks, with modest or moderate economic activity in eight of the Fed’s districts.
“The economy is still moving forward. What is happening in the marketplace is outside the scope of the Beige Book; what you’re seeing in the marketplace is a question of valuation,” said Frank Fantozzi, CEO of Planned Financial Services in Cleveland, Ohio.
In her speech, Yellen reiterated her intention to support the recovery even as the labor market improves, with the 6.7 percent unemployment rate in March still a percentage point higher than the central bank’s projection of full employment.
“There is general skittishness, (and,) one of the more important things really is options expiration has moved up a day, so there’s a ton of intraday volatility. Also we have some big earnings tonight and tomorrow,” JJ Kinahan, chief strategist at TD Ameritrade, said of the market’s recent swings.
“It’s a big day today, we’ve got 17 out of the S&P 500 reporting, and so far it’s been more good than bad. There is more positive forward guidance than negative, so things will pick up in the second half of the year,” said Chris Gaffney, EverBank senior market strategist.
“And, we had industrial production come out on a positive note this morning, supporting the notion that the economy is heating up with the weather,” Gaffney said.