NEW YORK (AP) — Stocks rose in morning trading on Wall Street on Tuesday, a day after a selloff sent the Dow Jones Industrial Average into a bear market to join other major U.S. indexes.
The S&P 500 was up 1% at 10:22 a.m. Eastern time. The Dow rose 219 points, or 0.8%, to 29,498 and the Nasdaq rose 1.4%.
Energy stocks were among the biggest gainers as US crude prices rose 2.8%. Exxon Mobil rose 3.1%. Technology stocks and retailers also helped lead the gains. Apple rose 1.7% and Home Depot rose 1.8%.
The gains come amid a prolonged slide in shares. With just days left in September, stocks are headed for another month of losses as markets fear higher interest rates used to fight inflation could push the economy into recession.
The S&P 500 fell more than 6% in September and has been in a bear market since June, when it had fallen more than 20% below its all-time high set on January 1. 4. The Dow Jones’s plunge on Monday put it in the same company as the benchmark and tech-heavy Nasdaq.
Central banks around the world have been raising interest rates in an effort to make borrowing more expensive and cool inflation to its highest level in decades. The Federal Reserve has been particularly aggressive, raising its benchmark rate, which affects many consumer and business loans, again last week. Now it is in a range of 3% to 3.25%. It was practically zero at the beginning of the year.
The Fed also released a forecast suggesting its benchmark rate could be 4.4% by the end of the year, a full percentage point higher than forecast in June.
Wall Street is concerned that the Fed is putting too much brake on an economy that is already slowing and pushing it into a recession. Higher interest rates have been weighing on stocks, especially more expensive technology companies, which tend to look less attractive to investors as rates rise.
Bond yields were mixed on Tuesday. The 2-year Treasury yield, which tends to track expectations for Federal Reserve action, fell to 4.28% from 4.34% on Monday night. It is trading at its highest level since 2007. The 10-year Treasury yield, which influences mortgage rates, rose to 3.95% from 3.93%.
Fears of a recession have increased as inflation remains stubbornly high. Investors will be watching the next round of better corporate earnings closely to get an idea of how companies are dealing with inflation. The companies will report their latest quarterly results in early October.
Investors are also closely following the latest economic updates. Consumer confidence remains strong, despite higher prices on everything from food to clothing. The latest consumer confidence report for September from The Conference Board showed that the trust was even stronger than expected by economists.
The government is to release its weekly report on jobless benefits on Thursday, along with an updated report on second-quarter gross domestic product. On Friday, the government will release another report on personal income and spending that will help provide more detail on where and how inflation is affecting consumer spending.