NEW YORK – A volatile day on Wall Street ended Monday with stocks notching modest gains after climbing back from a steep slide that had knocked more than 1,200 points off the Dow Jones Industrial Average.
The late-afternoon comeback pulled the S&P 500 out of so-called correction territory – a drop of 10% or more from its recent high.
The market's gyration reflected investors' uncertainty over how aggressive the Federal Reserve's inflation-fighting measures will be and the possibility of conflict between Russia and Ukraine.
“We're in this wait-and-see mode, which is almost the most uncomfortable place to be, so I think the market is really grappling with that,” said Lindsey Bell, chief markets and money strategist at Ally Invest.
The S&P 500 ended 0.3% higher after having been down about 4%. The index has come back from a loss that big to notch a gain only three other times in the past. The tech-heavy Nasdaq index rose 0.6% after recovering from a nearly 5% descent.
Early in the day, benchmark stock indexes flirted with near 4-month lows as investors anticipated guidance from the Fed later this week about its plans to raise interest rates to tame inflation, which is at its highest level in nearly four decades.
The Fed's short-term rate has been pegged near zero since the pandemic hit the global economy in 2020 and that has fueled borrowing and spending by consumers and businesses.
But rising prices at supermarkets, car lots and gas stations are raising concerns that consumers will pare back spending to limit the pressure on their budgets. Companies have warned that supply-chain problems and higher raw materials costs could crimp their profits.
The S&P 500 rose 12.19 points to 4,410.13. It's now 8.1% below the all-time high it set on Jan. 3. The Dow rose 99.13 points to 34,364.50 and the Nasdaq gained 86.21 points to 13,855.13.