US stocks end higher as Treasury buybacks ease pressure on bond yields

US stocks closed higher Wednesday as an expansion of the Treasury Department’s debt buyback program pushed long-term bond yields lower, providing some relief to equity markets.

The S&P 500 rose 0.21%, or 16.22 points, to finish at 7,707.98, snapping a three-session losing streak.

The Nasdaq gained 0.16%, or 41.38 points, to 26,331.09, while the Dow Jones Industrial Average added 119.65 points, or 0.22%, to 53,463.05.

The VIX index, known as the "fear index," fell 6% to 14.89.

Buying accelerated after the Treasury Department announced plans to at least double the size of its repurchases of longer-term government debt, covering maturities of between 10 and 30 years.

The yield on the 30-year Treasury bond fell around nine basis points to 5.195%, a day after exceeding 5.33% and reaching its highest in 19 years.

The yield on the benchmark 10-year Treasury note declined more than five basis points to 4.653%.

Shares of home improvement retailers benefited from the retreat in borrowing costs, with Lowe’s gaining around 2% and Home Depot rising more than 2%.

Moderna soared more than 176%, recording its strongest session ever, after an experimental skin cancer vaccine developed with Merck delivered positive results in a late-stage trial. Merck jumped more than 12%.

Marvell Technology climbed 10% after announcing an artificial intelligence chip agreement with Google and granting Alphabet a warrant to purchase up to $12.2 billion of its shares.

In contrast, Broadcom and Advanced Micro Devices fell around 3.7% following reports that OpenAI’s second-quarter losses increased despite revenue growth.

Minutes from the Federal Reserve’s July meeting showed that officials saw the scope for higher interest rates if inflation failed to ease.

European stocks mostly lower

European stock exchanges closed mostly lower Wednesday as inflation concerns and weakness in banking and defense shares outweighed easing global bond yields.

The pan-European Stoxx 600 fell 0.11% to 651.16 points.

Germany’s DAX declined 0.14% to 26,091.33, France’s CAC 40 slipped 0.09% to 8,501.91, and Spain’s IBEX 35 was off 0.44% to 19,847.50.

Britain’s FTSE 100 bucked the negative trend, rising 0.14% to 10,743.35, supported by mining shares, according to European closing market data.