STORY: U.S. stocks rallied to close higher on Wednesday after Federal Reserve chair Jerome Powell acknowledged that inflation was starting to ease, in remarks he made following a quarter-point rate hike by the U.S. central bank.

The Dow closed up fractionally, while the S&P jumped 1% and the Nasdaq shot up 2%.

[POWELL]: “Restoring price stability will likely require maintaining a restrictive stance for some time….”

While Powell did not appear as hawkish as investors had feared, he did acknowledge that ongoing rate hikes were likely still appropriate – particularly with much more data to come, including the Labor Department's comprehensive January jobs report, due on Friday.

But Kevin Nicholson, Global Fixed Income CIO at RiverFront Investment Group, said that Powell didn’t deliver a strong enough message, particularly about inflationary pressure from rising wages and a still too-tight labor force – with data on Wednesday showing an average of 1.9 jobs available for every unemployed American.

“But all of the jobs that are being added are being added on Main Street – the small to mid-cap companies that make up about 50% of the hiring out there. [FLASH] And this is why I think the Fed is doing a disjustice at these press conferences by not pointing out the fact that that’s where the job growth is coming from. And, you know, wages are going to be pushed up still, because there are so many of these small businesses that are looking for workers and they just can’t find them – so when they do become available they’ll pay more for them.”

As for individual movers, Meta Platforms soared more than 18% in after-hours trade after the Facebook and Instagram parent cut its cost outlook for 2023 by $5 billion and projected first-quarter sales that could beat Wall Street estimates.