US stocks move higher as Federal Reserve starts key 2-day meeting; energy stocks gain most

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FILE - In this Aug. 16, 2007, file photo, the flags on the facade of the New York Stock Exchange provide a backdrop for a Wall Street street sign. Global stock markets were mostly lower Tuesday, Sept. 16, 2014, as jittery investors played it safe ahead of a potentially pivotal Federal Reserve meeting and the referendum on Scotland's independence on Thursday. (AP Photo/Richard Drew, File)

FILE - This March 4, 2013 file photo shows a sign for Wall Street on the side of building near the New York Stock Exchange, in New York. World stock markets sank Monday, Sept. 15, 2014, on weak Chinese economic data as investors looked ahead to a U.S. Federal Reserve meeting and Scotland's independence referendum. (AP Photo/Mark Lennihan, File)

NEW YORK — U.S. stocks moved higher in afternoon trading Tuesday with energy stocks leading the way. Investors kept an eye on a two-day Federal Reserve meeting that got underway.

KEEPING SCORE: All three major U.S. stock indexes rose, with the Dow Jones industrial average trading above its all-time closing high from July. The Dow gained 122 points, or 0.7 percent, to 17,153. The Standard & Poor's 500 index climbed 17 points, or 0.9 percent, to 2,001 as of 3 p.m. Eastern time. The Nasdaq composite rose 35 points, or 0.8 percent, to 4,553.

FED WATCH: The Fed began a two-day meeting on Tuesday morning that many investors expect will bring it closer to raising its key interest rate as the economy strengthens. Fed Chair Janet Yellen will discuss the outlook for employment and inflation, and the bank's rate plans in a press conference on Wednesday. The Fed has held the rate close to zero for more than five years, and stocks have surged against that backdrop.

WINNERS AND LOSERS: Energy stocks gained 1.6 percent, the most among the 10 industry sectors in the S&P 500, as oil prices climbed. Exxon Mobil rose 1.5 percent, the biggest gainer in the Dow. The price of U.S. benchmark crude increased $1.97, or 2 percent, to $94.89 in New York.

The Russell 2000, an index of small company stocks, rose 0.5 percent after falling 1.2 percent the previous day.

THE QUOTE: "The economy continues to improve in the U.S., and there's still an accommodative Fed," said Brad Sorensen, director of market and sector research at the Schwab Center for Financial Research. "We think the bull market has further to run."

BUYBACK BOOST: Humana Inc. rose $4.23 to $131.89, a gain 3 percent. The health insurer said it plans to repurchase as much as $2 billion of its own shares, double what it had previously planned. The stock has climbed 28 percent so far this year.

SEARS PLUMMETS: Sears Holdings fell $2.85, or 9 percent, to $30.67. The company is taking out a $400 million short-term loan from a hedge fund run by CEO Edward Lampert, the retail company's biggest owner. Sears has struggled against rivals like Wal-Mart Stores Inc. in recent years.

INFLATION WATCH: A measure of prices that U.S. producers receive for their goods and services was unchanged in August, the latest sign that inflation is in check. A drop in wholesale gas and food prices was offset by higher prices for transportation and shipping services, the Labor Department said Tuesday.

SCOTLAND'S CHOICE: Investors are also awaiting a referendum on Scottish independence on Thursday. The British pound has turned volatile in recent weeks as opinion polls narrowed ahead of the vote. A yes decision could trigger turmoil in the market as investors ponder the economic and financial fallout. The pound was up 0.3 percent Tuesday at $1.6276.

BONDS: The yield on the 10-year Treasury note was unchanged from Monday at 2.59 percent.

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