Stocks surge after Fed rate cut
Wall Street jumps as investors welcome news that central bank cut rates, as expected, and indicated its rate-cutting campaign could soon take a breather.
NEW YORK (CNNMoney.com) -- Stocks rallied Wednesday afternoon, with the Dow briefly crossing 13,000 after the Federal Reserve cut a key short-term interest rate by a quarter-percentage point, as expected, and signaled it may soon pause its rate-cutting campaign.
Around 5 minutes after the roughly 2:15 p.m. ET announcement, the Dow Jones industrial average (INDU) had added 1.29%. The broader Standard & Poor's 500 (SPX) index gained 0.8% and the Nasdaq composite (COMP) gained 0.8%.
The Federal Reserve cut the fed funds rate, a key overnight bank lending rate, by a quarter-percentage point to 2%, as expected. In its closely-watched statement, the central bank indicated that its rate-cutting campaign could soon take a breather.
Stocks rose ahead of the Fed announcement, as investors eyed readings on first-quarter GDP growth, April private sector employment and earnings from General Motors and Procter & Gamble. 
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