Treasury Boosts Longer-Term Bond Purchases as Stocks Rebound

U.S. stocks rebounded on Wednesday after the Treasury Department announced plans to ease pressure from the bond market by increasing its purchases of longer-term Treasurys.

The S&P 500 rose 0.2% for its first gain in four days, while the Dow Jones Industrial Average added 119 points and the Nasdaq composite ticked 0.2% higher.

Strong profit reports from companies like Estee Lauder, Target, and Moderna also supported Wall Street. Estee Lauder's revenue growth accelerated for a fourth straight quarter, with the strongest gains in mainland China.

The Treasury Department's move aims to provide greater liquidity support in longer-dated nominal sectors where there is consistent strong sponsorship from market participants.

However, some analysts warn that the relief may be short-lived, as the amount of bonds being repurchased is a fraction of the overall total and investors are questioning the Federal Reserve's credibility.