(Reuters) – The S&P and the Dow edged higher on Wednesday as energy and financial stocks rose, but gains were capped by worries over tensions on the Korean peninsula and a potential U.S. landfall of Hurricane Irma.
“What we see is the market correcting back from some of the reaction yesterday,” said Lisa Erickson, head of traditional investments at U.S. Bank Wealth Management in Helena, Montana.
The S&P posted its biggest one-day loss in about three weeks on Tuesday after North Korea conducted its most powerful nuclear test yet on Sunday that triggered a dramatic escalation of the country’s stand-off with the United States.
“In general, we continue to get a positive momentum on the economic side. While North Korea is still a wild card for certain, on the central bank front, both the ECB and the Fed are looking a little bit more dovish,” Erickson said.
Three Federal Reserve policymakers on Tuesday expressed doubts about further rate hikes, with one influential policymaker calling for a delay in raising U.S. interest rates until the central bank is confident inflation will rebound.
Also weighing on investors’ mind is Hurricane Irma, which is en route to a possible Florida landfall at the weekend and comes days after Tropical Storm Harvey wreaked havoc in Texas and Louisiana.
At 11:01 a.m. ET (1501 GMT), the Dow Jones Industrial Average .DJI was up 71.72 points, or 0.33 percent, at 21,825.03 and the S&P 500 .SPX was up 5.99 points, or 0.24 percent, at 2,463.84. The Nasdaq Composite .IXIC was up 0.01 points, or 0 percent, at 6,375.58.
Seven of the 11 major S&P indexes were higher, with a 1.52 percent rise in the energy index .SPNY topping the gainers.
Oil prices rose as strong global refining margins and the reopening of U.S. Gulf Coast refineries provided a more bullish outlook after sharp drops due to Storm Harvey. [O/R]Financial stocks .SPSY also gained 0.38 percent, a day after they suffered their biggest one-day fall since mid-May.
Fed Vice Chair Stanley Fischer, a veteran central banker who helped set the course for modern monetary policy, said on Wednesday he would step down mid October.
Fischer’s early departure gives President Donald Trump an opportunity to further shape the central bank sooner than expected.
United Continental (UAL.N) fell 4.3 percent after it warned Hurricane Harvey and North Korea tensions would hurt its third-quarter results.
Newell Brands (NWL.N) was off about 5 percent after the Sharpie maker slashed its profit outlook for 2017, while apparel retailer Francesca’s Holdings (FRAN.O) was down about 2 percent after its profit forecast fell below estimates.
Advancing issues outnumbered decliners on the NYSE by 1,830 to 887. On the Nasdaq, 1,539 issues rose and 1,183 fell.
Reporting by Sruthi Shankar in Bengaluru; Editing by Anil D’Silva