The Nasdaq Composite rebounded after a soft inflation report eased concerns about the economy and as investors snapped up beaten-up technology shares.

The tech-heavy index popped 1.7%. The S&P 500 added 0.9%, while the Dow Jones Industrial Average was trading marginally higher.

Nvidia shares gained 6%, while Meta Platforms and Tesla rose 2% and 7%, respectively.

The consumer price index, a broad measure of costs across the U.S. economy, increased 0.2% for the month, putting the annual inflation rate at 2.8%. This was lower than the respective Dow Jones estimates for 0.3% and 2.9%. Core CPI, which excludes volatile food and energy prices, rose 0.2% on the month and 3.1% for the past 12 months, both below expectations.

"This reading is going to be a little dilutive to this stagflation narrative, and it is going to restore to some extent policy flexibility from the Fed," said Dave Grecsek, managing director in investment strategy and research at Aspiriant Wealth Management. "If this inflation number was higher, you'd have some of these concerns weighing much more heavily, like the Fed would not be in a position to respond if the economy continues to weaken."

President Donald Trump's steel and aluminum tariffs took effect on Wednesday, and Canada said it will impose 25% retaliatory duties on more than $20 billion worth of U.S. goods. The European Union also responded swiftly, pledging to impose counter-tariffs on 26 billion euros ($28.33 billion) worth of U.S. imports beginning in April.

Stocks have been under pressure as traders fear the escalating tensions could trigger a U.S. recession. Part of the reason for the recent sell-off has been concern that President Donald Trump's volatile trade policy would raise inflation and slow growth, otherwise known as stagflation.

This week alone, the Dow, S&P 500 and Nasdaq have all dropped more than 3%. The S&P 500 briefly dipped into correction territory on Tuesday, down 10% from a record set in February. Over the past month, the S&P 500 has lost nearly 8%, while the Dow and Nasdaq have shed 6.6% and 11.3%, respectively.

"We're not surprised the market's pulled down. Obviously, U.S. equity markets have been exceptionally strong over the last two years. It's right to expect a correction," Grecsek added. "But I think once we get through this — we're in the very early events of these key fiscal policy changes — there's better news to come."(Cay)

Source: CNBC