US stocks rally after pressure eases from the bond market and oil prices
fall
[May 21, 2026] By
STAN CHOE
NEW YORK (AP) — The U.S. stock market bounced back Wednesday after
pressure eased on Wall Street from the bond market and oil prices gave
back some of their big gains.
The S&P 500 climbed 1.1% for its first rise in four days and pulled
closer to its all-time high set last week. The Dow Jones Industrial
Average added 645 points, or 1.3%, and the Nasdaq composite rallied
1.5%.
Stocks got a lift from easing yields in the bond market, which offered
relief following rapid climbs that had rattled stock markets worldwide
recently. The yield on the 10-year Treasury fell to 4.57% from 4.67%
late Tuesday, which is a significant move for a market that measures
things in hundredths of a percentage point.
The 10-year Treasury yield had been rising from less than 4% before the
war with Iran began, along with other yields around the world, because
of worries that the fighting will keep oil prices high, among other
factors. The inflation concerns not only seemed to eliminate the chances
for a cut to interest rates by the Federal Reserve this year, they also
heightened the risk that central banks may have to raise rates in 2026.
High yields slow economies and weigh on prices for stocks,
cryptocurrencies and all kinds of other investments. Besides driving up
rates for mortgages, they could also curtail companies’ borrowing to
build the artificial-intelligence data centers that have been supporting
the U.S. economy’s growth recently.
Yields eased Wednesday as oil prices pulled back some more. The price
for a barrel of Brent crude fell 5.6% to settle at $105.02, though it
remains well above its roughly $70 level from before the war. Prices
have been yo-yoing on rising and falling hopes that the United States
and Iran can reach an agreement to allow oil deliveries to fully resume
from the Persian Gulf to customers worldwide.
A report showing less bad inflation in the United Kingdom than
economists expected also helped calm yields worldwide.
With the easing of yields, technology stocks helped lead Wall Street
higher.
Nvidia rose 1.3% ahead of its latest profit report, which arrived after
trading ended for the day, and was the strongest force lifting the S&P
500. The chip company reported another quarter of bigger growth in
profit and revenue than analysts expected, while it also gave a
better-than-expected forecast for revenue in the current quarter.
Other tech stocks leading the market included Advanced Micro Devices, up
8.1%, and Intel, up 7.4%.
Smaller companies can feel even bigger relief from lower yields than
their bigger rivals because many need to borrow to grow. The Russell
2000 index of the smallest U.S. stocks jumped 2.6%, more than double the
gain of the S&P 500, which measures the biggest U.S. stocks.
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Options trader Chris Dattolo works on the floor of the New York
Stock Exchange, Wednesday, May 13, 2026. (AP Photo/Richard Drew)
 Also helping to drive the market was
the company behind TJ Maxx, Marshalls and other stores, which
climbed 5.7% after delivering stronger profit and revenue for the
latest quarter than analysts expected. TJX’s CEO, Ernie Herrman,
said the current quarter is off to a good start, and the off-price
retailer raised its forecasts for revenue and profit this year.
Red Robin Gourmet Burgers jumped 18.2%, and Cava Group rose 3.1%
following their own better-than-expected profit reports. Such
results raise hopes that households can keep spending and supporting
the economy, even though they’re contending with high gasoline
prices and widespread discouragement about economic conditions.
Most big U.S. companies have likewise reported better profits for
the start of 2026 than analysts expected, which has helped stocks
run to records. Stock prices tend to follow the path of corporate
profits over the long term.
On the losing side of Wall Street was Target, which fell 3.9% even
though the retailer reported better profit and revenue for the
latest quarter than analysts expected. A new CEO, Michael Fiddelke,
is trying to turn around the company and boost its revenue.
Expectations were high for the company’s performance after Target’s
stock came into the day with a gain of more than 30% for the year so
far, quadruple the S&P 500’s gain.
All told, the S&P 500 rose 79.36 points to 7,432.97. The Dow Jones
Industrial Averae jumped 645.47 to 50,009.35, and the Nasdaq
composite rallied 399.65 to 26,270.36.
In stock markets abroad, indexes climbed in Europe following weaker
finishes across Asia.
Tokyo’s Nikkei 225 fell 1.2% as the yield on the 10-year Japanese
government bond slipped but remained near its highest level since
1997.
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AP Business Writers Matt Ott and Elaine Kurtenbach contributed.
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