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Wall St Ends Higher, Powell Comments Avoid Rate Policy

- Investors await CPI data Thursday
- U.S. earnings season begins this week
- Jefferies shares rise after results
- Indexes: $Dow Jones Industrial Average(.DJI.US)$ up 0.6%, $S&P 500 Index(.SPX.US)$ up 0.7%, Nasdaq up 1%
Wall St Ends Higher, Powell Comments Avoid Rate Policy
U.S. stocks ended solidly higher on Tuesday, led by a 1% gain in the Nasdaq, on relief that Federal Reserve Chair Jerome Powell refrained in a speech from commenting on rate policy.
In his first public appearance of the year, Powell said at a forum sponsored by the Swedish central bank that the Fed's independence is essential for it to battle inflation.
Recent comments by other Fed officials have supported the view that the central bank needs to remain aggressive in raising interest rates to control inflation. Fed Governor Michelle Bowman said on Tuesday the bank will have to raise interest rates further to combat high inflation.
Investors anxiously awaited the U.S. consumer prices index report Thursday, which is expected to show some moderation in year-on-year prices in December.
Traders are betting on a 25-basis point rate hike at the Fed's upcoming policy meeting in February.
$Amazon(AMZN.US)$ shares rose 2.9% and gave the Nasdaq and S&P 500 their biggest boosts.
Shares of $Microsoft(MSFT.US)$ rose 0.8%, a day after Semafor, citing people familiar with the matter, reported that the tech company was in talks to invest $10 billion in ChatGPT-owner OpenAI.
Communications services was the day's best-performing sector, while energy rose along with oil prices.
This week marks the start of the fourth-quarter earnings season for S&P 500 companies, with results from several of Wall Street's biggest banks due later this week.
Shares of investment bank $Jefferies Financial(JEF.US)$ rose 3.8% on Tuesday, a day after it posted its second-best year for investment banking revenue. It also reported a 52.5% slump in fourth-quarter profit.
Analysts expect overall S&P 500 earnings to have declined 2.2% in the fourth quarter from a year ago, according to IBES data from Refinitiv, as worries about rising rates and the economy mounted.
Some investors are hoping for signs that the Fed may soon take a break after raising the federal funds rate seven times in 2022.
The World Bank on Tuesday slashed its 2023 growth forecasts on Tuesday to levels teetering on the brink of recession for many countries as the impact of central bank rate hikes intensifies. $SPDR S&P 500 ETF(SPY.US)$ $Invesco QQQ Trust(QQQ.US)$
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