Stocks rose on Thursday as global bond yields plummeted as investors digested trading data that was better than expected from China.
The Dow Jones Industrial Average traded 302 points higher, or 1.2%. The S&P 500 gained 1.6% while the Nasdaq Composite climbed 1.8%.
Thursday's strong gains helped the indexes recover most of the heavy losses from Monday's session. The Dow and S&P 500 fell almost 3% each Monday, while the Nasdaq fell 3.5%.
However, on Thursday afternoon, Nasdaq had a small weekly gain. The S&P 500 and Dow were down only 0.1
Technical stocks led the gains on Thursday, and the sector rose by about 2%. AMD was the best performing stock in the sector, rising around 14% as investors cheered on the release of a second generation chipset for data centers.
Disney shares also contributed to the gains, rising 1.8% after an analyst Credit Suisse upgraded the media giant to outperform neutral. The analyst expects the company to have a successful launch of Disney +, the company's streaming service.
The benchmark index on 10-year Treasury Note returns was trading at 1.76%. In Germany, the 10-year group gave negative 0.5% after going negative 0.6% – a record low – in the previous session.
The jump in global bond yields coincided with a Reuters report that said Germany was considering issuing new debt to finance a climate protection package. The report quoted a German official from the supreme government.
Yields fell worldwide on Wednesday as investors plunged into safer assets due to concerns about the global economy.
Round returns can signal global growth problems from investors and cause severe setbacks in equity markets. An escalation in China-US trade tensions has highlighted these fears in recent days. Wall Street saw a wild ride on Wednesday as the S&P 500 recorded its biggest intraday comeback of the year.
Traders work on the floor of the New York Stock Exchange.
Brendan McDermid | Reuters
A series of interest rate cuts from central banks around the world fueled concerns over global growth. New Zealand, India and Thailand are all cutting interest rates, citing concerns that growth is slowing.
"The net result of all this has been a collapse in global interest rates both in the long and short end of curves that far outweigh the slowdown in global activity," Michael Shaoul, CEO of Marketfield Asset Management, said in a note . "We are far more accustomed to seeing the opposite happen, with central banks historically slow to respond to sharp declines in corporate earnings and only step in as labor markets begin to signal the impact on employment."
"Instead, central banks and fixed income markets appear to be trapped in a feedback cycle where lower returns signal looser policies and vice versa," Shaoul said. "What this actually means for underlying economic activity is much more difficult to ascertain."
Strong data from China helped slow down Wall Street. China said exports rose 3.3% year-on-year in July. Economists polled by Reuters expected exports to fall by 2%.
The data helped Asian stocks rise overnight. Shanghai Composite gained 0.9% while Nikkei 225 rose 0.4%.
However, investors remained cautious as they monitored the yuan. China's central bank on Thursday set the official reference rate for the Chinese currency at 7.0039 yuan per dollar – the weakest level since April 21, 2008.
China set the yuan's midpoint above 7 per US dollar earlier this week. It triggered the worst sale on Wall Street for 2019.
—CNBC's Silvia Amaro contributed to this report.