CORRECTED-US STOCKS-Wall Street climbs after Fed signals potential rate cuts

By Noel Randewich
Updated

(In fourth paragraph, corrects month to June, not May)

* Dow up 0.24%, S&P up 0.24%, Nasdaq up 0.21%

By Noel Randewich

June 19 (Reuters) - Wall Street rose on Wednesday after the Federal Reserve held interest rates steady, as expected, and signaled potential cuts later this year.

Saying it "will act as appropriate to sustain" economic expansion, the central bank signaled rate cuts of as much as half a percentage point over the remainder of 2019.

"We think the Fed delivered. It did no harm. It walked right up to a cut without doing it today. It'll likely be coming in July absent some big trade news or other news," said John Augustine, chief investment officer at Huntington Bank in Columbus, Ohio.

Buoyed by growing confidence the Fed will cut rates, and by hopes of an end to the U.S.-China trade war, U.S. stocks have climbed in recent weeks. The S&P 500 has gained about 6% in June and is about 1% away from its record high close set in April.

The financial sector was up 0.1%, with bank stocks dipping 0.1%.

All three major indexes rose following the announcement.

At 2:17 p.m. ET the Dow Jones Industrial Average was up 0.24% at 26,530.35 points, while the S&P 500 was up 0.24% at 2,924.75.

The Nasdaq Composite was up 0.21% at 7,970.94.

The healthcare sector rose 0.9%, helped by gains in UnitedHealth Group Inc, Pfizer Inc and Allergan Plc.

Allergan jumped 5.8% after the drugmaker said its constipation drug, jointly developed with Ironwood Pharmaceuticals Inc, improved symptoms in patients suffering from irritable bowel syndrome with constipation.

Adobe Inc surged 4.5% after the Photoshop software provider beat analysts' estimates for quarterly profit and revenue. (Reporting by Noel Randewich; Additional reporting by Shreyashi Sanyal and Aparajita Saxena in Bengaluru Editing by Alistair Bell and Lisa Shumaker)