US: Stocks open higher after steep losses

[NEW YORK] Wall Street stocks rose early on Wednesday, recovering somewhat from the prior session's rout as Treasury bond yields retreated and markets monitored ongoing budget talks in Washington.

"It is a reflexive bid," Briefing.com's Patrick O'Hare said of the early gains. "Market participants will presumably want to test the conviction of the buy-the-dip crowd to see if there is more to the mechanical rebound trade than meets the cynical eye."

About 10 minutes into trading, the Dow Jones Industrial Average was up 0.1 per cent at 34,338,95.

The broad-based S&P 500 advanced 0.3 per cent to 4,364.52, while the tech-rich Nasdaq Composite Index advanced 0.5 per cent to 14,614.88.

The S&P 500 lost two per cent on Tuesday amid worries over rising Treasury yields and the impasse in Congress over raising the debt ceiling.

The lack of progress in Washington on a deal has raised the possibility of a default on US government debt, while lawmakers must also reach an agreement on funding the government this week to prevent a shutdown.

Policy makers such as Treasury Secretary Janet Yellen have warned of dire consequences from failing to raise the borrowing limit.

The market has so far taken the risk in stride, with many investors pointing to a history of brinksmanship prior to last-minute agreements that avert a default.

AFP