Equities rebounded on bargain-hunting Wednesday to recover about half of Tuesday's one percent decline. The Dow Jones industrial average firmed 0.2 percent, the S&P 500 rose 0.5 percent, and the Nasdaq rose 0.6 percent. US Treasury yields declined while the dollar and oil prices rose.

Gains were nearly across the board, paced by megacaps and chipmakers that got whacked on Tuesday. Bond yields retreated too with Treasuries bolstered by a soft reading in US job openings and ADP private payrolls data. Federal Reserve Chair Jerome Powell's appearance gave rise to relief buying in stocks as there were no hawkish surprises. Powell repeated what other officials have been saying for weeks, that it makes sense to normalize policy this year but officials need more confidence on inflation before they move.

Among stock sectors, best were technology, utilities, health care, consumer staples, materials and industrials. Consumer discretionary and communications services were relatively soft amid weakness in Amazon and Alphabet, respectively.

Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.

Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.