S&P 500, Nasdaq close sharply higher Wednesday after Fed keeps slowing pace of rate hikes

The S&P 500 and Nasdaq Composite closed sharply higher on Wednesday, erasing earlier losses, after the Federal Reserve increased its benchmark short-term rate by a smaller 25 basis point increment. The Dow Jones Industrial Average
DJIA,
+0.02%
edged up by about 6 points, or less than 0.1%, ending near 34,092. But the S&P 500 index
SPX,
+1.05%
gained 1.1% and the Nasdaq Composite Index
COMP,
+2.00%
posted a 2% climb, according to preliminary FactSet data. The Federal Reserve increased its policy rate to a 4.5% to 4.75% range, which followed six larger rate hikes in a row as the Fed continued its work to tame the worst stretch of inflation in 40 years. Bullish investors appeared to seize on Fed Chair Jerome Powell’s less aggressive tone on the path of future rate hikes, in an afternoon news conference, where he hinted that the U.S. central bank was likely to increase rates a couple more times, but then consider taking a breather. “We have no intention to overtighten,” Powell said.