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[BRIEFING.COM] Stocks regained some momentum late in Wednesday's trading, as oversold conditions beckoned for a bounce while easing geopolitical concerns and some portfolio rebalancing helped improve sentiment ahead of another widely anticipated Fed rate hike. The indices closed near session highs.

On the heels of a session in which the Dow logged its worst single-day percentage loss in more than three weeks, and a 1.6% sell-off on the Nasdaq that left the tech-laden index down 4.8% for the year, a sense that losses may have been excessive, especially given the lack of overwhelming evidence to support such a broad-based pullback, lent some early support. That is, until ongoing uncertainty surrounding what the Fed policy statement will imply about the need for more rate hikes tomorrow continued to act as an overhang on the market that kept stocks in a typical holding pattern heading into the culmination of a two-day FOMC meeting Thursday at 2:15 ET.

Be that as it may, in a market where limited participation can lead to volatile trading, news hitting the wires around 2:00 ET that Sunni insurgent groups will halt attacks if the U.S. removes its troops from the region provided just the right anecdote for a market obsessed with what the Fed may or may not say in its policy statement. As has been the case lately, volume on the NYSE did not surpass 1.0 bln shares until 2:30 ET.

With only two days remaining before Q2 comes to a close, some end-of-the-quarter window dressing on the part of portfolio managers also contributed to the late-day recovery that kept sellers on the sidelines into the close. All three indices rose in synch with each other and logged roughly the same percentage gains, which suggests that program trading was behind the broad-based move to the upside.

All ten economic sectors posted gains today, with energy pacing the way higher with a 2.0% gain. Crude oil prices, which briefly turned negative on the session, managed to close modestly higher and stay above $72 per barrel. An analyst upgrade on Hess Corp (HES 50.31 +2.11) and a larger than expected drawdown in crude stockpiles last week provided additional sector support.

The resilience of the rate-sensitive Financials sector, which inched back into positive territory for the year despite nervousness throughout the Treasury market ahead of tomorrow's Fed statement, was also worth noting. A report showing catastrophe bond issuance is on the rise renewed interest in struggling reinsurer Marsh and McLennan (MMC 26.96 +1.04) while Wells Fargo (WFC 66.25 +1.11) raising its dividend, announcing a 2-for-1 split, and setting a 25 mln share buyback also incited bargain hunters to take another look at the underperforming sector. Meanwhile, the spread between the 2-yr and 10-yr note remained inverted, as yields across the curve were at or near the projected fed funds rate of 5.25%.

Further, Technology's ability to hold onto modest gains in the face of rising interest rates that continue to question the valuations of growth stocks and further deterioration in the influential semiconductor group, also played a role in the market's ability to turn in a respectable performance.
NYSE Adv/Dec 1972/1280...Nasdaq Adv/Dec 1606/1398