The Dow Jones industrial average closed down just 22 points Tuesday after being down by more than 250 points shortly after trading opened. The bounce back was stoked by comments from Congressional leaders saying they would not push for banks to spin-off lucrative trading desks as part of financial regulation reform.
Big swings in trading have again become the norm in recent weeks, similar to the volatility that helped define the market during the credit crisis and the early parts of the recovery last year.
The end-of-session focus Tuesday on domestic news was a stark contrast from what had been driving trading for the past few weeks. Investors had been almost wholly focused on whether steep budget cuts to manage rising debt in European countries would slow a global economic recovery in the coming months.
Concern about Europe's health was overshadowing consistent reports that the US economy was continuing its slow, steady growth. Early in the year, those reports pushed stocks higher.
Ahead of the opening bell, Dow Jones industrial average futures rose 75, or 0.8 percent, to 10,100. Standard and amp; Poor's 500 index futures rose 9.10, or 0.9 percent, to 1,082.10, while Nasdaq 100 index futures gained 15.75, or 0.8 percent, to 1,830.75.
Even though signs still point to recovery in the US, concerns about Europe remain. The euro, which is used by 16 European countries, fell again Wednesday. The currency has become a proxy for investor confidence in Europe's ability to contain its debt problems the health of the continent's economy. The euro remains close to the four-year low it hit last week. It was down to $1.2318 Wednesday.
Despite the ongoing concerns, major European indexes snapped back after big losses Tuesday.
Britain's FTSE 100 gained 2.1 percent, Germany's DAX index rose 1.9 percent, and France's CAC-40 climbed 2.7 percent.
Meanwhile, US Treasury prices fell. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.23 percent from 3.16 percent late Tuesday.
