Wall Street Gains Ground

(AP) -- Stocks rose in morning trading on Wall Street Tuesday and oil prices eased back as investors remain focused on the outlook for inflation.

The S&P 500 rose 0.8% as of 10:18 a.m. Eastern. The Dow Jones Industrial Average rose 261 points, or 0.8%, to 34,811 and the Nasdaq rose 1.2%.

Banks helped lead the gains as bond yields continued rising. Higher bond yields allow banks to charge more lucrative interest on loans. The yield on the 10-year Treasury rose to 2.38% from 2.30% late Monday. Bank of America rose 3.6% and JPMorgan Chase gained 2.7%.

Technology stocks and retailers also gained ground. Nike jumped 5.1% after reporting surprisingly good third-quarter financial results. Energy stocks slipped as oil prices fell. U.S. benchmark crude oil fell 1.5%. European markets were higher and Asian markets closed higher overnight

The broad gains follow a day of choppy trading after Federal Reserve Chair Jerome Powell said the central bank was prepared to move more aggressively in raising interest rates in its fight against inflation, if it needed to. Powell said the Fed would raise its benchmark short-term interest rate by a half-point at multiple Fed meetings, if necessary.

Last Wednesday, the central bank announced a quarter-point rate hike, its first interest rate increase since 2018. The Fed hasn't raised its benchmark rate by a half-point since May 2000.

Investors' concerns about persistently rising inflation has been worsened by Russia's war in Ukraine. Energy and commodity prices were already high as demand outpaced supply amid the global economic recovery, but the conflict has pushed oil, wheat and other prices even higher.

Rising raw material costs and shipping problems have made it more expensive for businesses to operate. Many of those costs have been passed on to consumers and higher prices for food, clothing and other goods could result in less spending and slower economic growth.

Concerns about the rising inflation and slower economic growth have been weighing down stocks so far in 2022, but a rally last week helped trim some of the benchmark S&P 500's losses for the year. Investors will soon start readying for the next round of corporate earnings reports as the current quarter nears its close and that could provide a clearer picture of how industries continue handling rising costs.