Wall Street Up 2% in Biggest Daily Gain in 6 Weeks as US Recession Fears Abate

NEW YORK (Sputnik) - Wall Street’s three major stock indices rose by about 2% each on Wednesday, staging their biggest one-day rebound in six weeks, as investors regained their risk appetite after worries earlier in the week about the potential worsening of the economic situation in the United States.

The Dow Jones Industrial Average, Wall Street’s broadest equities indicator comprising stocks of 30 large US corporations, closed up 1.9%. Year-to-date, the Dow remained down 18%, not too far from from the 20% drop earlier in the week that placed it in bear-market territory.

The S&P 500 Index, which represents the top 500 US stocks, settled up 2%. For the year, it showed a drop of 22%.

The Nasdaq Composite Index, which comprises marquee names in technology such as Amazon, Apple, Netflix and Google, finished up 2.1%. Year-to-date, Nasdaq was down 29%.

Stocks rebounded as the dollar and bond yields plunged after the Bank of England delayed plans to begin its quantitative tightening and temporarily buy UK government bonds instead to restore orderly market conditions.

The move put pressure on UK government bond yields, which trade inversely to prices, dragging other sovereign bonds, including US Treasury note yields, lower.

The yield on the US ten-year Treasury note also tumbled, to a near one-week low of 3.71 from a 14-year high of 4.01 earlier on Wednesday. High bond yields typically reflect investor fear.

The Dollar Index, which pits the US currency against the euro and four other rivals, hovered at 112.5 - down 1.3% on the day for its sharpest tumble since a 1.45% drop on June 16. The dollar, of late, has been a default safe haven for investors betting on a recession.