Dow consolidates gains by more than 400 points

The Dow Jones Industrial Average gained 455 points, or 1.46%. The S&P 500 rose 1.79% and the Nasdaq Composite ticked up 2.06%, attempting to break a seven-day losing streak.

Stocks rallied as Fed Vice Chair Lael Brainard reaffirmed that the central bank would do what it takes to stifle inflation, while also noting the risks of going too far. Many traders decided to focus on this latter point from her speech.

US Treasury yields dipped following a jump on Tuesday. Oil prices slumped, with West Texas Intermediate crude dipping below $85 a barrel. The British pound hit its lowest level against the dollar since 1985.

“At some point in the tightening cycle, the risks will become more two-sided,” Brainard said adding that “the rapidity of the tightening cycle and its global nature, as well as the uncertainty around the pace at which the effects of tighter financial conditions are working their way through aggregate demand, create risks associated with overtightening.”