US stocks claw back some of their losses as yields dip

NEW YORK (AP) — U.S. stocks rose in early trading today to claw back some of their sharp losses from the prior day, when speculation about a more aggressive Federal Reserve rattled markets.

Treasury yields dipped modestly, which helped support stocks.

The Standard & Poor's 500 index was up 13 points, or 0.4 percent, at 2,757, shortly after 10 a.m. Eastern time. If it remains there, the index would recoup nearly half of its loss from the prior day.

The Dow Jones industrial average rose 121, or 0.4 percent, to 25,531, and the Nasdaq composite gained 39, or 0.5 percent, to 7,369.

The 10-year Treasury note dipped to 2.88 percent from 2.90 percent late Tuesday.

The 10-year gave up about half its gain from the prior day, when Treasury yields climbed on speculation that the Federal Reserve may get more aggressive about raising interest rates. Fed Chairman Jerome Powell told Congress that he's more optimistic about the economy, which led some investors to pencil in four rate increases for 2018, up from the three of last year.

Higher rates make bonds more attractive as investments and can divert buyers away from stocks. Worries that rates will rise higher and more quickly than the market expected helped trigger a 10 percent tumble for stocks worldwide earlier this month.

The two-year Treasury yield, which is more influenced by expectations for movements by the Fed, held steady at 2.27 percent. The 30-year Treasury yield, which is more influenced by expectations for inflation, fell to 3.14 percent from 3.16 percent.

Booking Holdings, the company formerly known as Priceline, jumped to the biggest gain in the S&P 500 after it reported a bigger profit for the latest quarter than analysts expected, aided by stronger travel bookings.