Wall Street Returns to Positive Territory

U.S. stocks broke two days of losses on Wednesday as a jump in Apple shares helped push indexes higher.

Apple rose 3.1 percent, its biggest gain since April, a day after announcing updated versions of the iPhone, a new smartwatch and a mobile payment system. The company is the largest component of both the Standard & Poor's 500 and Nasdaq composite indexes.

Gains in the broad market were muted as investors fretted over the timing and pace of Federal Reserve increases in interest rates, which are widely expected next year.

"The economy is getting better, and that worries people," said John Manley, chief equity strategist at Wells Fargo Funds Management. "People are afraid the Fed will raise rates too quickly."

A drop in a key oil price to the lowest level since in nearly 1 ½ years also weighed on the market. Several oil companies fell. Chevron dropped 0.7 percent.

Apple made the biggest splash on a slow day for news. Investors scrambled to understand the impact of its new products on the fortunes of other companies, sending a number of stocks sharply higher, and others sharply lower.

EBay fell 3 percent over fears its PayPal division will lose business to Apple's new payment system. But GPS device maker Garmin reversed big losses from Tuesday with a gain of 4 percent as investors seemed to dismiss the threat from the Apple's smartwatch.

Apple closed at $101, up $3.01. It is has gained 26 percent since the beginning of the year.

The Dow Jones industrial average ended the day up 54.84 points, or 0.3 percent, to 17,068.71. The S&P 500 rose 7.25 points, or 0.4 percent, to 1,995.69.

The Nasdaq rose 34.24 points, or 0.8 percent, to 4,586.52. Apple comprises 8.5 percent of the tech-heavy index, so a big move in its stock price has an outsize influence on tech-heavy index.

Investors were questioning whether the U.S. Federal Reserve might raise its benchmark interest rate earlier than many had expected as the economy gains strength. In a note to clients Wednesday morning, Steven Ricchiuto, chief economist at Mizuho Securities, said he thinks the consensus over the timing of the first increase will soon shift to early next year, rather than over the summer.

"The worst things for stocks would be the Fed to raise rates sooner rather than later," said Ricchiuto in a phone interview.

Adding to the nervousness was a paper earlier this week from two San Francisco Fed economists that said the public appears to expect a "more accommodative" policy, meaning low rates for longer, than do Fed board members.

Investors will be watching a report on unemployment claims out Thursday and one on retail sales Friday for a read on the economy.

Also weighing on markets was a $1.12 drop in Brent crude to close at $98.04 a barrel, the lowest price since May 2013. It was the fifth straight drop for Brent crude, a benchmark for international oils used by many U.S. refineries.

The price of U.S. benchmark oil also fell to its lowest level since January after the Energy Department reported large increases in stocks of gasoline and diesel. Benchmark U.S. crude fell $1.08 cents to close at $91.67 a barrel on the New York Mercantile Exchange.

In other energy futures trading, wholesale gasoline fell 2.1 cents to close at $2.527 a gallon and natural gas fell 3 cents to close at $3.954 per 1,000 cubic feet.

Among stocks making big moves:

— Krispy Kreme Doughnuts fell 54 cents, or 3 percent, to $17.07 after its second-quarter earnings fell short of analysts' expectations. The stock is down 12 percent since the start of the year.

— Palo Alto Networks rose $9.47, or 11 percent, to $98.75 after the security-software maker forecast healthier revenue in its first quarter.

The price of the 10-year Treasury note fell. The yield rose to 2.54 percent from 2.50 percent on Tuesday.

In metals trading, the price of gold fell $3.20 to $1,245.30 an ounce. Silver was flat at $18.93 an ounce and copper edged up a penny to $3.11 a pound.