Dow Rises 300 Points, Bond Yields Steady and Oil Prices Rally

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Stocks traded mostly higher Wednesday as bond yields steadied and oil prices rebounded after the Suez Canal was blocked by a huge containership that ran aground.

© TheStreet Dow Rises, Bond Yields Steady and Oil Prices Rally

The Dow Jones Industrial Average gained 231 points, or 0.71%, to 32,654, the S&P 500 was up 0.27% but the Nasdaq traded lower, falling 0.87%.

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Intel traded slightly lower after the chipmaker said it was investing $20 billion in two new factories in Arizona as it looks to create a foundry business to provide chips for other companies.

Rotation, Rebalancing and COVID Worries Roil the Market

Stocks finished lower Tuesday, bond yields retreated and oil prices plunged on worries a resurgence of the coronavirus could delay a reopening of the global economy. The Nasdaq dropped 1.12%.

Bond yields declined Wednesday. Federal Reserve Chairman Jerome Powell, in testimony before a congressional committee, said he expected inflation to move higher this year but added the Fed’s “best view is that the effect on inflation will be neither particularly large nor persistent.”

Powell said Wednesday before the Senate Banking Committee that prices could rise amid pent-up spending and supply-chain bottlenecks.

The central bank previously predicted that inflation, as measured by personal consumption expenditures, would rise 2.4% this year and then slow next year to 2%.

The 10-year U.S. Treasury yield was at 1.631% on Wednesday. The benchmark yield hit 1.754% last week, a 14-month high.

Investors will be closely monitoring Treasury bond auctions both Wednesday and Thursday.

Oil prices in the U.S. rose 5.14% to $60.73 a barrel, rebounding from Tuesday’s plunge of as much as 6% on renewed lockdowns in Europe. Prices soared Wednesday after the Suez Canal was blocked by a Taiwanese tanker that blew off course, creating a bottleneck that could slow the delivery of more than 13 million barrels of crude through one of the world’s busiest waterways.

Bitcoin rose to $55,848 Wednesday after Tesla CEO Elon Musk said Wednesday the electric vehicle company would begin accepting the world’s largest cryptocurrency as payment for its cars.

Tesla and Bitcoin: Jim Cramer Says Elon Musk Is a ‘Pioneer’

This article was originally published by TheStreet.

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