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U.S. stocks bounced back Wednesday after pressure eased on Wall Street from both the bond market and oil prices, helping lift major indexes as investors looked for breathing room in rate expectations. The rebound followed a stretch in which rising yields had rattled markets, and in which oil prices had given traders a sharper reminder of how quickly geopolitical risk can reprice energy and inflation outlooks.
The S&P 500 rose 1.1% for its first increase in four days and moved closer to its all-time high set last week. The Dow Jones Industrial Average climbed 645 points, or 1.3%, while the Nasdaq composite added 1.5%, as investors returned to riskier segments of the market.
A key factor in the session was a pullback in Treasury yields, which had climbed rapidly in recent weeks. The 10-year Treasury yield fell to 4.67% from 4.67% late Tuesday, a shift described by the Associated Press as significant for a market that moves in hundredths of a percentage point. The AP said the earlier rise in the 10-year yield had been tied to worries that fighting related to the war with Iran would keep oil prices elevated and undermine prospects for Federal Reserve rate cuts this year.
The AP also pointed to the broader impact of high yields on the economy and investment choices. Higher yields can slow growth and weigh on prices for stocks and other assets, including cryptocurrencies, and they can affect borrowing costs for mortgages and for companies looking to finance new projects. The AP further said the pricing pressure could curtail corporate borrowing tied to the artificial-intelligence data center buildout.
Oil prices also eased, reducing one of the immediate inputs into inflation and rate expectations. Brent crude, the AP reported, settled 5.6% lower at $105.02, though it remained well above its roughly $70 level before the war with Iran began. The AP said prices have been moving in a pattern of fast gains and losses as expectations have shifted for a possible U.S.-Iran agreement that would allow oil deliveries to fully resume from the Persian Gulf.
Earnings and company-specific results contributed to the rally as investors positioned for a strong phase of the corporate results calendar. The AP reported that technology stocks led the gains, with Nvidia rising 1.3% ahead of its latest profit report. The AP said Nvidia’s results included another quarter of larger profit and revenue growth than analysts expected, along with a better-than-expected forecast for current-quarter revenue.
Other chip and technology names also rose as investors leaned into the group. The AP reported that Advanced Micro Devices gained 8.1% and Intel rose 7.4%, while the rally extended beyond large-cap stocks. Smaller companies received an outsized share of the relief, with the Russell 2000 climbing 2.6%, more than double the gain of the S&P 500.
Retail earnings helped support the market tone as well. The AP said the company behind TJ Maxx and Marshalls, TJX Companies, climbed 5.7% after reporting stronger profit and revenue than analysts expected, and that the company raised its forecasts for revenue and profit this year. The AP also cited other profit-driven moves including Red Robin Gourmet Burgers, which jumped 18.2%, and Cava Group, which rose 3.1%, following their own results.
On the downside, the AP pointed to Target as an example of how stock reactions can diverge from earnings beats. Target fell 3.9% even though the retailer reported better profit and revenue than analysts expected, and the AP said the company has a new CEO, Michael Fiddelke, who is trying to turn around the business and boost revenue. The AP also noted that Target’s shares entered the day up more than 30% for the year, far ahead of the S&P 500’s gain.
By the close, the AP reported that the S&P 500 rose 79.36 points to 7,432.97, while the Dow jumped 645.47 to 50,009.35 and the Nasdaq composite rallied 399.65 to 26,270.36. Markets abroad also moved higher, with European indexes rising after weaker finishes across Asia. The AP said Tokyo’s Nikkei 225 fell 1.2%, even as the yield on Japan’s 10-year government bond slipped but remained near its highest level since 1997.