US close: Stocks record second straight day of gains
Stocks closed higher on Wednesday, extending the rally they initiated in the previous session as investors remained hopeful the Fed will lower interest rates before the end of the year.
At the close, the Dow Jones Industrials closed 0.82% higher at 25,539.37, while the S&P 500 was also up 0.82% at 2,826.14 as the Nasdaq saw out the session 0.64% firmer at 7,575.48.
The Dow closed 207 points higher on Wednesday, a day after Wall Street stocks recorded their second best day of the year on Tuesday, closing 511 points higher as market focus shifted from trade concerns to monetary policy after Fed chair Jerome Powell signalled the central bank would be open to easing monetary policy in order to save the economy.
Powell told an audience in Chicago that the central bank would "act as appropriate to sustain the expansion".
Asian and key European stocks also climbed on Wednesday, building upon the gains seen Stateside.
Elsewhere, trade tensions remained in focus as Trump, during his state visit to the UK, doubled down on tariff threats against Mexico, stating that the new policy would "take effect next week".
However, White House trade adviser Peter Navarro seemingly left the door open to avoid the 5% tariffs during an interview with CNN.
"We believe that these tariffs may not have to go into effect precisely because we have the Mexicans' attention," he said.
On the other side of the Pacific, Treasury Secretary Steven Mnuchin will meet with People's Bank of China Governor Yi Gang over the weekend, marking the first face-to-face meeting between those two top officials from the US and China.
In terms of economic data, hiring in the US hit a wall last month, according to the results of one of the most closely-followed surveys on the health of the US jobs market.
According to consultancy ADP, private sector payrolls increased by only 27,000 (consensus: 178,000) in May, for the lowest initial estimate since September 2010.
Elsewhere, IHS Markit's services and composite PMIs both came to 50.9 for May, in line with expectations and preliminary readings.
That figure was the service PMI lowest since February 2016, while the composite index was its weakest since May the same year and down sharply from its February high of 56.0.
Lastly, the Institute for Supply Management's non-manufacturing index revealed the US services sector expanded at a faster rate than expected in April.
The index rose to 56.9 in May from 55.5 in April, while business activity in the sector rose to 61.2 from 59.6 in April, its 118th consecutive month of expansion.
On the corporate front, Campbell Soup shares closed 10% higher after posting stronger-than-expected third quarter earnings and boosting its full-year profit estimates, while GameStop shares tumbled 35% in the session after releasing disappointing first-quarter earnings and cutting its dividend.
Salesforce.com was up 5.06% at the close after revealing overnight that earnings had risen more than 25%.