Stocks rebounded on Thursday, following back-to-back losing sessions, as investors reassessed the Federal Reserve's latest plans to tighten monetary policy and combat rising inflation.
The Dow Jones Industrial Average rose 87.06 points, or 0.25%, to 34,583.57 after dropping as much as 300 points earlier in the session. The S&P 500 advanced 0.43% to 4,500.21, and the Nasdaq Composite inched up 0.06% to 13,897.30 following two straight days of losses.
Defensive names like consumer staples and health-care companies led Thursday's market comeback as investors continued their search for stocks with stable earnings and dividends. Costco rallied nearly 4%, while Pfizer popped 4.3%. Walmart, Merck, UnitedHealth Group and Procter & Gamble also notched gains for the day.
Get Tri-state area news and weather forecasts to your inbox. Sign up for NBC New York newsletters.
On the tech front, Tesla gained 1.1%, while Twitter fell 5.4%. Shares of HP Inc surged about 15% after Warren Buffett's Berkshire Hathaway disclosed a stake in the tech hardware maker.
"The moves are not surprising," said Timothy Lesko, senior wealth advisor at Mariner Wealth Advisors. "You have a marketplace that is trying to get its head around what valuations should be in a higher interest rate environment. Every piece of economic news that comes out changes that forward expectation at the margin and the market needs to figure that out."
The Nasdaq ended the session down 2.55% since the start of the week, while the S&P 500 ended 1% lower. At the close, the S&P 500 was more than 6% off its all-time high.
"The S&P 500 has come under pressure over the past couple of sessions, however key support at 4455/50 is still holding for now," wrote Credit Suisse's David Sneddon. "Only a break below here would turn the short-term risks back lower in the range. Particularly concerning is that volume has been ticking up as the market falls."
Thursday's moves came after the Fed released minutes from its March meeting on Wednesday, which showed that officials planned to reduce their trillions in bond holdings with a consensus amount around $95 billion. Meanwhile, policymakers indicated that one or more 50 basis-point interest rate hikes could be warranted to battle surging inflation.
"The minutes from the latest FOMC meeting portray a higher level of urgency than previous communication as the Fed has circled on a commitment to run the balance sheet down faster than market participants may have expected," said Charlie Ripley, senior investment strategist at Allianz Investment Management.
Officials "generally agreed" that a maximum of $60 billion in Treasurys and $35 billion in mortgage-backed securities would be allowed to roll off, phased in over three months and likely starting in May.
Investors on Thursday continued to monitor the Ukraine-Russia war, as Ukraine asks NATO for more weapons and the EU and U.S. weigh a ban on Russian coal. Meanwhile, the U.S. Senate passed a bill banning Russian oil and gas imports.
Crude prices, which have been volatile amid the war in Ukraine, continued their descent from the previous session on Thursday. U.S. oil fell 0.6% to $96.03 per barrel, while international Brent slid 0.5% to $100.58.