U.S. stock indexes ended mixed on Wednesday, attempting to recover from Tuesday’s broad-based selloff following comments by Federal Reserve chairman Jerome Powell suggesting more interest rate rises may be necessary to tame inflation than investors were expecting. How stock indexes traded
S&P 500
SPX,
+0.14%
gained 5.64 points, or 0.1%, to end at 3,992.01 points
Dow Jones Industrial Average
DJIA,
-0.18%
fell 58.06 points, or 0.2%, to finish at 32,798.40
The Nasdaq Composite
COMP,
+0.40%
rose 45.67 points, or 0.4%, ending at 11,576
On Tuesday, the Dow Jones Industrial Average fell 575 points, or 1.72%, to 32,856, the S&P 500 declined 62 points, or 1.53%, to 3,986, and the Nasdaq Composite dropped 145 points, or 1.25%, to 11,530.
What drove markets Investors tuned in to the second day of Fed Chair Powell’s semiannual monetary policy testimony to Congress in which Powell said the central bank has not made any decision on the size of a potential interest rate hike later this month despite strong labor market data and a rise in inflation in January. Powell, in a testimony to the House Financial Services panel, said the central bank has yet to decide how large an interest rate hike to impose at its next meeting in two weeks. “We have not made any decision about the March meeting. We’re not going to do that until we see the additional data,” Powell said, while emphasizing that the Fed is not on a “pre-set path.” “We will be guided by the incoming data and the evolving outlook,” he said. See: Fed may stutter-step at end of interest rate hiking cycle for first time since 1990. What it means for financial markets. On Tuesday, Powell told the Senate Banking Committee that the central bank was prepared to increase the pace of interest rate hikes if data indicated it was warranted to damp inflation. “The market has interpreted what he[Powell] said as being an indication that we may see higher rate hikes at the next meeting than we previously have expected, and that the terminal rate will be higher than what markets had priced in a month or so ago,” Richard Flax, chief in …