Stocks closed higher on Wall Street Tuesday as technology companies rebounded after an early loss. The S&P 500 rose 0.9%. The index is coming off five straight losses and hadn’t closed higher since the very first trading day of the year, the AP reports. The S&P 500 rose 42.78 point to 4,713.07. The Dow Jones Industrial Average rose 183.15 points, or 0.5%, to 36,252.02. The Nasdaq rose 210.62 points, or 1.4%, to 15,153.45. The Russell 2000 index of smaller companies rose 22.85 points, or 1.1%, to 2,194.
Traders are trying to calibrate how markets and the economy will handle the higher interest rates that are likely on the way from the Federal Reserve this year. That has weighed heaviest on pricey technology stocks, which become less attractive to investors as interest rates rise. Tech stocks have been choppy since late Monday, when a late-afternoon rally for the sector trimmed much of the broader market's losses. Apple rose 1.7% and chipmaker Nvidia rose 1.5%. The price of US crude oil jumped 3.8%, helping boost energy stocks.
The Fed has said it will accelerate the reduction of its bond purchases, which have helped keep interest rates low. The market now puts the chances of the Fed raising short-term rates by at least a quarter point in March at around 78%. A month ago, it was about 36%. The central bank is easing up on its support for the US economy and financial markets as businesses and consumers face persistently rising inflation. Fed Chair Jerome Powell acknowledged Tuesday that high inflation has emerged as a serious threat to the Fed's goal of helping put more Americans back to work and that the Fed will raise rates more than it now plans if needed to stem surging prices. Powell spoke at a hearing of the Senate Banking Committee, which is considering his nomination for a second four-year term.
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