Stocks rose Tuesday, as the Dow Jones Industrial Average and S&P 500 bounced back slightly from their lowest closing levels in nearly two years.
The Dow was up 65 points, or 0.2%, despite climbing more than 300 points earlier in the session as the 2-year Treasury yield pared back its losses. The S&P 500 gained 0.4%, and the Nasdaq Composite rose 0.8%.
Treasury yields came off their lows. The yield on the 2-year Treasury was flat after falling about 5 points earlier in the morning. The benchmark 10-year yield was up nearly 7 basis points to 3.949% despite falling earlier.
The British pound rebounded slightly after plunging to a record low against the dollar earlier in the week. Sterling traded more than 1% higher at $1.087 per dollar after hitting an all-time low of $1.0382. It has since curtailed those gains slightly, up 0.9% at $1.078.
Chicago Federal Reserve President Charles Evans signaled some apprehension about the central bank raising rates too quickly to fight inflation, in contrast to a slew of Fed officials who recently reiterated a tough stance against rising prices.
The moves comes after five straight days of losses for stocks, with the S&P 500 closing at its lowest level since 2020. The Dow dropped more than 300 points on Monday, putting it in a bear market after falling more than 20% below its record high. The 30-stock average also posted its lowest closing level since late 2020.
Technical indicators show that the selling has been historic. According to Bespoke Investment Group, the 10-day advance decline line for the S&P 500 has hit a record low, meaning market breadth is at its worst level in at least 32 years.
The latest round of selling appears to have several catalysts, including an aggressive Federal Reserve and surging interest rates, which in turn have roiled currency markets. On Monday, the British pound slid to a record low against the dollar, unnerving investors on both sides of the Atlantic.
Read More: S&P 500 rebounds slightly Tuesday from lowest close since 2020