Banks push Wall Street to record high

Major US stock indices established record highs on Tuesday, led by bank stocks after Federal Reserve Chair Janet Yellen said it would be unwise to wait too long to raise interest rates. Apple racked up a record high close for the second straight session.

MAJOR US stock indices established record highs on Tuesday, led by bank stocks after Federal Reserve Chair Janet Yellen said it would be unwise to wait too long to raise interest rates.

Apple racked up a record high close for the second straight session, contributing to gains in the S&P 500, Dow Jones Industrial Average and Nasdaq Composite indices.

Ms. Yellen said delaying rate hikes could force the US central bank to tighten monetary policy quicker down the line, which could risk a recession. She also expressed uncertainty over economic policy under the Trump administration.

Banks, expected to gain from higher interest rates, led the market higher. Goldman Sachs rose 1.29% and Bank of America added 2.82%. The S&P 500 financial index jumped 1.24%.

So far in 2017, the KBW banking index has increased 4.50%.

President Donald J. Trump’s pro- business stance sparked a record-setting rally in stocks following his November election. However, he has given scant detail on his policies, leaving the Fed with limited visibility about the economy’s future direction.

Speaking to the US Senate Banking Committee, Ms. Yellen did not indicate whether the Fed still planned to raise rates three times this year, nor did she indicate whether a hike might come in March or in June, as most analysts expect.

“With the new president, there is still the uncertainty of the economic policy,” said Jeff Carbone, co-founder of Cornerstone Financial Partners in Charlotte, North Carolina. “How much growth we get out of the market will affect policy making and how quickly they need to react.”

The Dow Jones Industrial Average climbed 0.45% to end at 20,504.41 points, while the S&P 500 gained 0.40% to 2,337.58.

The Nasdaq Composite added 0.32% to 5,782.57.

Ms. Yellen’s comments lifted the dollar and US Treasury yields.

Eight of the 11 major S&P sectors rose, with health care adding 0.73%.

Apple rose as high as $135.09, an intraday record high, before ending with a gain of 1.30% at $135.02, its highest-ever finish.

General Motors ( GM) added 4.84% after Peugeot owner PSA Group said it is in talks to buy GM’s European Opel business.

The prospects of sector consolidation caused Fiat Chrysler to jump 4.39%, while Ford gained 0.72%.

Advancing issues outnumbered declining ones on the NYSE by a 1.09- to-1 ratio; on Nasdaq, a 1.31-to-1 ratio favored advancers. The S&P 500 posted 60 new 52-week highs and no new lows; the Nasdaq Composite recorded 124 new highs and 22 new lows. About 6.7 billion shares changed hands on US exchanges, in line with its daily average over the last 20 sessions. —