Wall Street rebounds, Treasury yields rise on hawkish Fed comments
Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., March 21, 2022. /Reuters

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., March 21, 2022. /Reuters

Wall Street stocks on Tuesday regained their swagger after a down session to open the week, notching solid gains, while Treasury yields rose following hawkish comments from the U.S. Federal Reserve (Fed).

Following last week's rally, equities retreated Monday on jitters over hawkish commentary from Fed Chair Jerome Powell, who signaled the likelihood of interest rate hikes by bigger steps if needed. 

The Nasdaq led Wall Street's main indexes higher, rising nearly 2 percent, as investors bought the dip in technology stocks, including Apple, Microsoft,, Meta Platforms and Alphabet.

The Dow Jones Industrial Average rose 254.87 points, or 0.74 percent, to 34,807.86 and the S&P 500 gained 50.63 points, or 1.13 percent, to 4,511.81.

Treasury yields marched higher as investors digested Powell's comments. At around 2000 GMT, the U.S. ten-year Treasury yield was at 2.38 percent, having hit its highest level since 2019. The two-year note also ticked up, to yield 2.16 percent, from 2.13 percent.

The market is pricing in a 72.2 percent probability that the Fed will hike the federal funds rate 50 basis points when policymakers meet in May, up from a probability of just over 50 percent on Monday.

Oil prices pulled back less than 1 percent on Tuesday as the dollar strengthened and it looked unlikely that the European Union would pursue an embargo on Russian oil, a day after prices jumped 7 percent and also rose earlier in the session.

The dollar edged lower on Tuesday as the boost from Powell's comments faded and a rise in equities markets helped boost risk-on sentiment. 

Spot gold dropped 0.7 percent to $1,921.73 an ounce, pressured by rising interest rates.

(With input from AFP and Reuters)

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