After those words, the main indicators turned small losses into gains. The Dow-Jones ended 2.2 percent higher at 34,589.77 points. The broader S&P 500 gained 3.1 percent to 4080.11 points and tech exchange Nasdaq rose 4.4 percent to 11,468 points.
Higher interest rates are generally unfavorable for the value of shares. Powell did warn that interest rates will be high for a while yet. Also, the key interest rate will rise to a higher level than previously predicted.
Investors also digested the Beige Book, the Fed’s monthly report on the state of the US economy. It grew only slightly in November, partly due to high inflation and rising borrowing costs. Payroll processor ADP reported that fewer jobs were added in the US last month than in October.