Stocks rise modestly on Wall Street a day after rout

Stocks rose modestly on Wall Street Wednesday as the market regains its footing following a sharp drop a day earlier.

The S&P 500 rose 0.3% as of 1:15 p.m. Eastern. The Dow Jones Industrial Average rose 111 points, or 0.3%, to 34,411 and the Nasdaq fell 0.1%.

Health care companies and a mix of companies that focus on consumer products led the gains.

Technology stocks edged higher after leading the market’s slide a day prior. Much of that pressure came from rising bond yields spooking investors. The higher yields have forced investors to reassess whether prices have run too high for stocks, particularly technology companies, because it makes their prices look expensive.

Apple rose 1% and and IBM rose 1.2%.

Bond yields stabilized and lifted some pressure off of investors who have been watching them rise sharply over the last week. The yield on the 10-year Treasury, which is used to set interest rates on many kinds of loans, remained at 1.53% late Tuesday.

Markets in Asia mostly fell while markets in Europe made gains.

The broader market is still on track for a disappointing September. The benchmark S&P 500 is headed for a 3.5% loss and its first losing month since January. Investors have spent much of the month reviewing a mixed batch of economic data that showed COVID-19 and the highly contagious delta variant’s impact on consumer spending and the employment market recovery.

Investors are still closely watching the Federal Reserve to gauge how the slowdown in economic growth will impact the speed of its plan to eventually ease its exceptional support for the economy. The central bank has said that it plans to eventually trim bond purchases that have helped maintain low interest rates.

Wall Street is also preparing for the next round of corporate earnings in the next few weeks. Investors will get a more detailed look at how supply chain problems and higher costs are impacting corporate finances.

A wide range of companies have been warning investors about the impact of inflation on costs and profits. Nike, Costco and FedEx are among those that have cited materials costs, shipping delays and labor problems as concerns.

Sherwin-Williams became the latest company to warn that higher raw materials costs will hurt profits. The stock gained 1.5% as investors took the announcement in stride, but it is still down roughly 8% from its all-time high of $308.70 on Sept. 2.

Investors are still trying to gauge just how persistent rising inflation will be as the economy works through, and eventually recovers from, the pandemic. The Fed has said that higher inflation will likely be temporary and tied to the economic recovery, but more companies have signaled that they expect higher costs to linger.