US stock markets surge

NYSE traders Image copyright Getty Images

The US stock market surged on Wednesday, lifting one of the major indexes to a record, after the head of the US central bank predicted borrowing costs would remain relatively low.

Federal Reserve Chair Janet Yellen said policymakers plan to continue to raise interest rates to reach a neutral policy stance.

But she said there was not much further to go before reaching that point.

The testimony boosted the Dow Jones by 0.6% to 21,532.14 - a record.

The S&P 500 climbed 0.7% to 2,443.25, while the tech-heavy Nasdaq jumped 1.1% to 6,261.2.

The gains came across all sectors, led by technology.

Online payment company Paypal was among the winners, rising more than 3%, after it announced customers would be able to use PayPal on Apple products.

Banks, which benefit from higher interest rates and are scheduled to report quarterly earnings on Friday, fared less well.

Bank of America shares fell about 1%, while Citigroup edged up 0.2%