(RTTNews.com) - Following the sell-off seen in recent sessions, stocks showed a significant rebound over the course of the trading day on Wednesday. The major averages fluctuated early in the session but moved sharply higher as the day progressed.
Going into the close, the major averages saw further upside, reaching new highs for the session. The Dow soared 1,086.25 or 5 percent to 22,878.45, the Nasdaq spiked 361.44 points or 5.8 percent to 6,554.36 and the S&P 500 surged up 116.60 points or 5 percent to 2,467.70.
Bargain hunting contributed to the rally on Wall Street, with traders picking up stocks at reduced levels on the heels of recent weakness.
The continued sell-off seen in a holiday-shortened session on Monday dragged the major averages down to their lowest closing levels in well over a year.
The extent of the upward move may have been exaggerated by below average volume, however, as many traders remained away from their desks after the Christmas Day holiday on Tuesday.
A lack of major U.S. economic data also kept traders on the sidelines, although reports on new home sales, consumer confidence, and pending home sales may attract attention in the coming days.
Positive sentiment may have been generated by members of President Donald Trump's administration continuing to downplay reports the president has privately discussed firing Federal Reserve Chairman Jerome Powell.
White House Council of Economic Advisers Chairman Kevin Hassett told reporters that Powell's job is "100 percent" safe.
Asked if he meant the Fed Chairman's job is not in jeopardy by the president, Hassett added, "Absolutely. That's correct."
The comments from Hassett come after Treasury Secretary Steven Mnuchin also disputed the reports in a post on Twitter on Saturday, claiming Trump disagrees with the Fed's policy but never suggested firing Powell.
Meanwhile, the partial government continues, with Trump stating the government will not reopen until Democrats agree to fund his controversial border wall.
Rebounding following a recent sell-off, energy stocks showed a substantial move back to the upside along with the price of crude oil.
Crude for February delivery spiked $3.69 to $46.22 a barrel after plunging $3.06 to an eighteen-month closing low of $42.53 a barrel on Monday.
Reflecting the strength in the energy sector, the NYSE Arca Natural Gas Index soared by 7.7 percent, while the Philadelphia Oil Service Index and the NYSE Arca Oil Index and the surged up by 6.5 percent and 6.4 percent, respectively.
Significant strength was also visible among retail stocks, as reflected by the 6.9 percent jump by the Dow Jones Retail Index. The index rebounded after ending the previous session at its lowest closing level in a year.
The rebound by retail stocks came after data released by Mastercard ( MA ) showed U.S. holiday retail sales recorded the strongest growth in six years.
Software, biotechnology, semiconductor, and transportation stocks also saw considerable strength, moving higher along with most of the other major sectors.
Meanwhile, gold stocks were among the few groups to buck the uptrend, with the NYSE Arca Gold Bugs Index falling by 1.2 percent.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower on Wednesday, although Japan'sNikkei 225 Index bucked the downtrend and advanced by 0.8 percent. Many markets in region were closed on the day.
Meanwhile, the major European markets also remained closed on the day as a result of the Boxing Day holiday.
In the bond market, treasuries gave back ground amid the rebound on Wall Street. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, climbed 4.8 basis points to 2.797 percent.
Trading on Thursday may be impacted by reaction to a batch of economic data, including reports on weekly jobless claims, new home sales and consumer confidence.
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