NEW YORK — U.S. stocks changed course and turned higher Wednesday, with drug and consumer companies leading the way. Investors were willing to take a few more risks than the day before, but they remained cautious, and demand for bonds and precious metals stayed high.
Stocks opened lower, and the Dow Jones industrial average fell as much as 127 early on. Indexes started moving higher at noon and finished at their highest levels of the day. Phone companies, traditionally safe investments, fell after some recent gains. Bond prices were little changed after Tuesday’s surge, which pulled the yields on long-term U.S. bonds to their lowest levels ever recorded.
The day before, investors flocked to bonds and sold off all but the steadiest stocks as they worried about the health of Britain’s financial system. Those fears faded a bit on Wednesday, but Kristina Hooper, head of U.S. investment strategies at Allianz Global Investors, said demand for bonds will remain high as the effects of the British vote to leave the European Union ripple through the markets.
“It’s probably safe to assume there will be bouts of continued fear going forward that could drive the yield down ... even lower than where we’ve already been,” she said.
The Dow rose 78.00 to 17,918.62. The S&P 500 index added 11.18 to 2,099.73. The Nasdaq gained 36.26 to 4,859.16.
Drugmakers AbbVie and Biogen led health care stocks higher after regulators in the European Union approved their drug Zinbryta, a treatment for multiple sclerosis that can be take just once a month. Bond prices inched higher and yields fell as investors sought safety following Britain’s vote to leave the European Union. The yield on the 10-year Treasury note slipped to 1.37 percent from 1.38 percent and the yield on the 30-year Treasury bond fell to 2.14 percent from 2.15 percent. According to Tradeweb, both yields set all-time lows early Wednesday, reaching 1.32 percent and 2.10 percent, respectively.
Bond yields have tumbled over the last few months following a weak U.S. jobs report and then the unexpected result of the British referendum to leave the European Union. While the yields on U.S. bonds have fallen, they remain higher than yields from other advanced economies, some of which are negative. The U.S. economy also appears to be in better shape.
The price of gold rose $8.40 to $1,367.10 an ounce and silver surged 30 cents, or 1.5 percent, to $20.20 an ounce. Gold is trading at its highest price since March 2014 while silver is at its highest price since August of that year.