Stocks on Wall Street closed higher on Tuesday, as investors pinned their hopes on the US Federal Reserve sticking to its current bond-buying stimulus programme.
The Dow Jones Industrial Average rose 138.38 points, or 0.91% to finish at 15318.23.
Elsewhere, the Standard and Poor’s 500 rose 12 points, or 0.8%, to 1,651.
Traders are now waiting for the conclusion of the latest Federal Reserve meeting on Wednesday.
Investors appear confident that the Fed will not opt to wind down its economic stimulus programme just yet, despite the recent improvements in the US economy.
“The game is different from what it used to be,” said Mark Spellman, portfolio manager for Value Line Funds in New York.
“It’s not just, ‘Is the Fed going to raise (its benchmark interest rate) up or down?’ It’s ‘Is the Fed going to keep buying $85bn worth of bonds each month?'” he added.
Official figures on Tuesday suggested a pick-up in new homes building and inflation that is rising at a manageable rate.
Shares in Dell rose 0.5% after the billionaire investor Carl Icahn called on the computer maker to purchase a majority of its outstanding shares for $14 per share in his latest effort to block founder Michael Dell’s plan to take the company private. Dell has offered $13.65 per share.
UnitedHealth rose 2% after Deutsche Bank raised the price target on the shares to $63 from $60.
Hormel Foods, the maker of Skippy peanut butter and Spam, slipped 3.6% after the company said it expects lower profits for the year.
Source-BBC
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