Stocks rose in thin trading Wednesday after the release of Federal Reserve policy minutes outlining the central bank's thinking about how to tighten monetary policy when the time comes.
The Dow Jones Industrial Average gained more than 75 spoints, breaking a three-day losing streak,amid weak earnings and evidence of a slowing U.S. economy.
Oil giants ExxonMobil and Chevron rose along with oil prices, and were among stocks that led the blue-chip index higher.
Hewlett-Packard led Dow laggards for a second day after the tech giant posted disappointing earnings results on Tuesday and received a downgrade from JPMorgan to "neutral" from "overweight." The brokerage also cut the PC maker's price target to $42 a share from $55, saying HP's revised outlook for the fiscal third quarter and the full year is a "major disappointment." In addition, at least four other brokerages also cut their price targets on the firm.
TheS&P 500 and the Nasdaq also gained, with the tech-heavy Nasdaq up more than 1 percent. The CBOE Volatility Index, widely considered the best gauge of fear in the market, fell to nearly 16.
Among key S&P 500 sectors, materials and energy gained, while utilities fell, in a reversal of a trend seen over the last couple sessions.
The market got a lift on Wednesday from the dollar, which traded lower most of the session, and the fact "the negativity in the market is taking a little bit of a breather," said Quincy Krosby, market strategist at Prudential Financial.
Another factor is the expiration of stock index futures and options on Friday, Krosby said. "That really does tend to skew the markets a few days before," she said.
Also, market participants are beginning to think the Fed will continue to support an accomodative monetary policyin the months ahead.
Most Federal Reserve officialsprefer to tighten policy through interest rate hikes rather than asset sales, according to the minutes of the Federal Reserve's policy setting meeting, which were released on Wednesday.
The central bank indicated they would eventually cut the Fed's portfolio, and that selling mortgage-related debt would be a priority, Reuters reported, describing the discussions of an exit strategy as "intense."