NEW YORK, May 7 (Xinhua) -- U.S. stocks recovered from Tuesday' s sell-off but closed mixed Wednesday as investors embraced the Federal Reserve Chair Janet Yellen's generally dovish testimony on the Capitol Hill.
The Dow Jones Industrial Average surged 117.52 points, or 0.72 percent, to 16,518.54. The S&P 500 increased 10.49 points, or 0.56 percent, to 1,878.21. The Nasdaq Composite Index shed 13.09 points, or 0.32 percent, to 4,067.67.
Yellen gave no surprise in her prepared congressional testimony, which said "a high degree of monetary accommodation remains warranted," as considerable degree of slack remains in labor markets and inflation is still anchored.
However, the market still responded positively to Yellen's remarks before the joint economic committee of U.S. Congress, as she continued to reassure investors by saying "we expect considerable time before normalizing rate policy," and that most Fed officials expect to normalize policy in 2015 or 2016.
The Fed chief also noted in the Q&A session that valuations in the stock market are in normal historical ranges, adding that " overall those broader metrics don't suggest we are in obviously bubble territory," from which investors got some comforts after the blue-chip Dow and the broader S&P 500 had edged close to record highs recently and momentum stocks continued to see a correction amid tech-bubble worries.
Injecting optimism into the market, Russian President Vladimir Putin reportedly planned to discuss the Ukraine issue with regional leaders in Moscow on Thursday, easing concerns over geopolitical tensions.
The tech-rich Nasdaq, which continued to underperform the other two indices, was once again under selling pressure, as Twitter extended sufferings, sliding 3.74 percent to 30.66 U.S. dollars apiece. The decline came after the microblogging site's six-month lock-up period which had restricted sale of about 82 percent of its outstanding shares expired Tuesday.
In corporate news, China's e-commerce giant Alibaba filed for initial public offering (IPO) in the United States late Tuesday, planning to raise 1 billion dollars. But analysts predicted that the company could fund around 15 billion dollars to 20 billion dollars through its IPO, which is expected to be one of the largest stock listings in history.
On the economic front, U.S. nonfarm business sector labor productivity decreased at a 1.7 percent annual rate during the first quarter, the Labor Department reported before the opening bell. The decline was larger than market expectations.
U.S. mortgage applications climbed 5.3 percent for the week ending May 2 from one week earlier, according to the Mortgage Bankers Association.
The CBOE Volatility Index, a gauge of fear in the market, fell 2.90 percent to end at 13.40.
In other markets, the dollar advanced against most major currencies Wednesday after Yellen's remarks showed optimism about U.S. economic growth.
In late New York trading, the euro dropped to 1.3916 dollars from 1.3933 dollars in the previous session, while the dollar bought 101.78 Japanese yen, higher than 101.58 yen of the previous session.
U.S. oil prices jumped up after an official report showed U.S. crude oil inventories plunged. Light, sweet crude for June delivery gained 1.27 dollars to settle at 100.77 dollars a barrel on the New York Mercantile Exchange.
Gold futures on the COMEX division of the New York Mercantile Exchange fell below 1,300 dollars per ounce following Yellen's encouraging testimony before Congress. The most active gold contract for June delivery fell 19.7 dollars, or 1.51 percent, to settle at 1288.9 dollars per ounce.