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Federal Reserve chairman Jerome Powell gave investors reason to cheer on Wednesday when he suggested that the Fed may slow down its interest rate hikes.

The Dow surged on the news, finishing the day with a gain of 618 points, or 2.5%. It was the fifth-biggest point jump for the Dow ever. The S&P 500 and Nasdaq each rose more than 2% as well.

Powell reassured investors that the Fed wouldn’t risk killing off economic growth by continuing to aggressively raise rates next year.

“Our gradual pace of raising interest rates has been an exercise in balancing risks,” Powell said during a speech at the Economic Club of New York. “We know that moving too fast would risk shortening the expansion. We also know that moving too slowly – keeping interest rates too low for too long – could risk other distortions in the form of higher inflation.”

Powell noted that rates remain relatively low and that they are just below what many economists consider “neutral for the economy – that is, neither speeding up nor slowing down growth.”

Investors seemed to interpret Powell’s comments as a sign that the Fed, which is widely expected to raise rates again at a meeting next month, may now only hike rates once or maybe twice at most in 2019 as opposed to earlier forecasts of three or four hikes.

The Dow’s most cyclical stocks were among the biggest gainers. Shares of Boeing (BA), Caterpillar (CAT), Microsoft (MSFT) and Apple (AAPL) helped lead the rally.

In fact, only one Dow stock, Verizon (VZ), ended the day lower Wednesday.

Matthew Cheslock, a trader at Virtu Financial, told CNNMoney editor-at-large Richard Quest on “Markets Now” Wednesday that investors interpreted Powell’s comments as meaning that we are “closer to normal rates. I think that was what really sparked the market to go higher.”

Cheslock added that some of Powell’s remarks about the market not being in a bubble were reassuring as well.

Powell’s comments may assuage concerns about the Fed possibly going too far with rate increases, a criticism leveled by President Donald Trump.

But Tobias Levkovich, Citigroup chief US equity strategist, told Quest that the market may be overreacting.

“I’m not dancing or partying right at the moment,” he said, adding that the Fed has talked about gradual rate hikes “for a very long time.” “Maybe [the markets] were just worried it would be worse,” Levkovich said.

To that end, Trump, who chose Powell to replace former Fed chief Janet Yellen, has often bashed him and the Fed on Twitter and in interviews for the rate hikes.

In fact, Trump attacked Powell again in a Washington Post interview Tuesday, saying he was “not even a little bit happy” with Powell and that the Fed was making a mistake with so many rate hikes.

Trump even added that sometimes decisions he makes with his “gut” matter more than what other people’s brains tell him.

Whether or not investors were using their guts or brains when deciding to jump back into stocks Wednesday remains to be seen. But it’s clear that the bulls were back in charge on Wednesday.

“Markets Now” streams live from the New York Stock Exchange every Wednesday at 12:45 p.m. ET. Hosted by Quest and CNNMoney’s business correspondents, the 15-minute program features incisive commentary from experts.

You can watch “Markets Now” at from your desk or on your phone or tablet. If you can’t catch the show live, check out highlights online and through the Markets Now newsletter, delivered to your inbox every afternoon.

CNN’s Danielle Wiener-Bronner contributed to this story.