The market remains on track for its worst December since 1931, during the depths of the Depression, and could finish 2018 with its steepest losses in a decade. Energy companies fell along with the price of oil.
The strong gains come after the Dow and S&P flitted between gains and losses earlier. The Dow slid 359 points, or 1.5 percent, to 22,520. After meeting with the CEOs of the six largest USA banks, Mnuchin tweeted that banks had "ample liquidity" to meet the needs of borrowers.
On Wednesday, Kevin Hassett, chairman of the White House Council of Economic Advisers, weighed in, saying Powell is in no danger of being fired, The Wall Street Journal reported. Texas Instruments dropped 1.3 per cent to $91.74. Investors have also been unnerved by the personnel turmoil inside the Trump administration, trade tensions with China, the slowing global economy and worries that corporate profits are going to slip sooner or later. In early afternoon, only 5 stocks in the benchmark index were higher.
The Nasdaq composite gained 361.44 points, or 5.8 per cent, to 6,554.36. That followed the market's best day in 10 years.
The previous record point gain for the Dow was 936.42 on October 13, 2008, during a period when markets were whipsawed nearly daily by developments in the financial crisis, which was then in full swing.
Even so, Smart said, "If you look at simple valuations in this market, it's clearly much more attractive than it was over the summer and I think it means that it's hard to see a lot more downside from here". Marathon Petroleum rose 4.8 percent to $56.93.
The dollar strengthened to 111.36 yen from 110.41 yen on Monday.
In Europe, the benchmark Euro Stoxx 50 lost 1.1%. Copper gained 1.5 percent to $2.70 a pound.
United States 2018 holiday sales rose 5.1 percent from a year ago to over $850 billion, the strongest gain in six years, according to a Mastercard report. But despite Wednesday's surge, it remained on pace for its biggest monthly percentage drop since February 2009, during the throes of the financial crisis. It tumbled more than 5 percent on Tuesday before recovering slightly a day later.
Markets in Hong Kong and Australia, which reopened after Christmas, climbed too. In China, the Shanghai Composite shed 0.3% on Wednesday.