Stocks rose for a second session Wednesday, with the S&P 500 and Dow Jones Industrial Average closing at records, as technology stocks powered higher and investors shook off geopolitical concerns.
The S&P 500 rallied 0.71% to end at 5,792.04 after notching an all-time high, while the Nasdaq Composite added 0.6% to finish at 18,291.62. The 30-stock Dow surged 431.63 points, or 1.03%, to settle at 42,512.00 and at a record close.
Technology stocks were notable leaders in the rally, with Amazon and Apple gaining more than 1%. Super Micro Computer rallied 4%. Wednesday's advance helped correct a bumpy start to October, pushing the major averages into positive territory for the month.
Stocks maintained their gains after minutes from the Federal Reserve's September meeting, where it cut by a half percentage point, revealed that a "substantial majority of participants" favored reducing rates by the larger amount.
S&P 500 year to date
"The Fed is the key thing, that's the big driver," said Mike Bailey, director of research at FBB Capital Partners. "Again, anything can happen at any moment. You wake up and there's a headline about the hurricane, energy. At this point, we're really not seeing a lot of those risks getting priced in."
Wednesday's gains came despite lingering fears of a broader war in the Middle East and a disappointing session in China as investors took profits from the recent stimulus-fueled rally. The China Shenzhen registered its worst day since 1997, with the iShares China Large-Cap ETF (FXI) falling more than 1%. Alphabet lost 1.5% on news that the DOJ is weighing a breakup.
Wall Street is coming off a strong session driven by tech gains and easing oil prices. Those moves seemed to reflect growing optimism that the Fed can navigate a soft landing, especially after last week's jobs report showed continued strength in the labor market.
"There's still a tug-of-war taking place between the 'Big 4' tailwinds (stimulus, disinflation, resilient growth, and healthy corporate performance) and rich valuations ... and the result is an SPX that's caught in a sideways price pattern," wrote Vital Knowledge's Adam Crisafulli.
To be sure, even with an underlying uptrend, the market could face further choppiness in what's historically the most volatile month of the year — especially ahead of the U.S. presidential election.
On the economic front, investors await the September consumer and producer price index readings due out Thursday and Friday, respectively. Earnings season kicks off Friday with the big banks JPMorgan Chase and Wells Fargo.
