Stocks jumped on Wednesday as Wall Street tried to recover some of the steep losses from the previous session.
The Dow Jones Industrial Average climbed 235 points, or 1 percent, led by gains in Visa and Microsoft. The S&P 500 gained 1.2 percent as the consumer discretionary sector outperformed. The Nasdaq Composite jumped 1.6 percent.
Shares of tech giants like Facebook, Amazon, Netflix and Alphabet all rose more than 2 percent. Apple’s stock also gained 1.9 percent.
Wednesday’s moves come after the worst Christmas Eve sell-off ever on Monday, which sent the S&P 500 into a bear market. The S&P 500 was down 20.06 percent from an intraday record high set on Sept. 21. The broad index is also down 19.78 percent from its record close reached the day before. U.S. exchanges were closed Tuesday for the Christmas holiday.
The plunge in stocks on Monday came after Treasury Secretary Steven Mnuchin held calls with CEOs of major U.S. banks last weekend and issued a statement saying, “The banks all confirmed ample liquidity is available for lending to consumer and business markets.”
On Monday, a senior Treasury official, who declined to be named, told CNBC that the purpose of the call and putting out the statement, was a “prudent, preemptive measure” following last week’s market volatility, which saw the Dow experiencing its worst one-week plunge in a decade. Yet while the moves were intended to be reassuring, they triggered confusion among market watchers.
“This call was absolutely unnecessary and in terms of their ability to communicate to the markets, they’re losing it,” Frank Troise, managing director at SoHo Capital, told CNBC’s “Squawk Box” on Wednesday.
Troise said the Treasury call begs the question of whether Mnuchin has “no idea what he’s doing” or if “there actually is a liquidity crisis.” If the latter option is the case, he questioned why it didn’t come up in the Federal Reserve’s recent minutes.
“The concern now in the market is actually that Treasury’s out of touch with what’s going on,” he said.
Monday’s move lower also came after President Donald Trump commented on the Federal Reserve once more, calling it “the only problem our eeconomy has” in a tweet. Trump also said Tuesday the Fed was “raising interest rates too fast because they think the economy is so good. ”
—CNBC’s John Melloy and Michael Sheetz contributed to this report.