By Yasin Ebrahim

Investing.com – The S&P 500 rallied Wednesday, shrugging off the Federal Reserve’s signal that tapering of its bond purchases could get underway as soon as November.      

The rose 1%, the gained 1.1%, or 338 points, the Nasdaq climbed 1%.

“If progress continues broadly as expected, the Committee judges that a moderation in the pace of asset purchases may soon be warranted,” the Fed said in a statement.

Later, Fed Chair Jerome Powell indicated that the taper might begin in November and be completed in the middle of 2022.  “Participants generally view, so long as the recovery remains on track, a gradual tapering process that concludes around the middle of next year is likely to be appropriate,” Powell said in a press conference that followed the monetary policy statement. 

However, analysts bet on November tapering leading up to the meeting. They suggested that this announcement had been priced in.     

Cyclical sectors including energy climbed more than 3%, underpinned by rising oil prices following data showing weekly U.S. oil supplies fell by a more than expected last week.

Last week’s inventories dropped by 4.7million barrels, which was lower than analysts expected.

Sentiment on oil has also been supported by “news that the OPEC countries of Nigeria and Angola, and OPEC+ member Kazakhstan, have lasting difficulties expanding their production due to a lack of investment,” Commerzbank (DE:) said in a note.

The sentiment regarding cyclical stocks (stocks that are linked to the economy) was further boosted by the news that Evergrande paid the interest on the domestic bond. On Wednesday, the central bank of China also pumped liquidity into the system.

Facebook (NASDAQ;) fell 4.4% after Facebook warned that Apple’s (NASDAQ.:) ad tracker would slow growth.

Adobe and FedEx were prominent figures in earnings news. 

Adobe Systems (NASDAQ:) reported third-quarter results that beat on both the top and bottom lines, but slowing growth in its core digital media business weighed the tech company’s shares.

“Adobe reported mixed F3Q results that exceeded consensus estimates on both top and bottom line offset by the core Digital Media ARR missing expectations,” Oppenheimer said in a note.

FedEx (NYSE:) cut its outlook on full-year performance after reporting quarter profit that fell short of estimates, sending its shares more than 9% lower