New high for Dow

Associated Press

Technology companies led U.S. stocks higher Wednesday in a broad rally that helped nudge the Dow Jones industrial average to a new high.

In remarks before Congress, Federal Reserve Chair Janet Yellen raised the possibility that the central bank would consider slowing the pace of its interest rate increases if inflation remained persistently below its target level.

The move assuaged concerns among some traders worried that the Fed has been moving too quickly to raise interest rates despite a slowdown in inflation and the U.S. economy’s sluggish growth of just 1.4 percent in the first quarter.

Yellen’s remarks put investors in a buying mood and sent bond yields lower, stoking demand for real-estate companies, utilities and other high-dividend paying stocks. Materials companies also posted hefty gains.

“Investors would prefer lower interest rates, particularly if the economy isn’t gaining the kind of traction that would warrant a faster rate-hike path,” said Quincy Krosby, chief market strategist at Prudential Financial. “This is positive for the markets.”

The yield on the 10-year Treasury note fell to 2.32 percent from 2.37 percent late Tuesday. Yields affect rates on mortgages and other consumer loans.