Bond yields retreated and equities rebounded Thursday with a boost from dip-buying in megacaps. The Dow Jones industrial average and the S&P 500 both gained 0.9 percent while the Nasdaq advanced by 1.5 percent. Bond yields declined while the dollar and oil prices gained.

Risk appetite recovered as many investors decided to be reassured by Federal Reserve Chair Jerome Powell's comments Wednesday, including his comment that the Fed was unlikely to raise rates. The market seems to be focusing on prospects for a soft landing with ongoing employment growth even as rates remain relatively high. That thesis will be tested Friday with release of monthly employment figures which are expected show a robust 240,000 rise in payrolls for April.

Among sectors, big technology and chipmakers led the gains with Nvidia up more than 3 percent. Qualcomm advanced after upbeat earnings. Apple gained too as the market anticipated another upbeat quarterly report after the close. In addition to tech, best sectors included consumer discretionary, real estate, consumer staples, energy and communications services. Lagging were health care and materials.

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.