NEW YORK >> Stocks finished broadly higher on Wall Street today, clawing back some of the ground they lost in their worst weekly drop since the beginning of the pandemic.

The rally to start the holiday-shortened week came as investors look ahead to what Federal Reserve Chair Jerome Powell will tell Congress on Wednesday, the first of two days of testimony as part of the central bank’s semi-annual monetary policy report. Last week, the Fed hiked its key short-term interest rate by the most since 1994, the central bank’s latest effort to tame the worst inflation in 40 years.

The S&P 500 rose 2.4%, recouping about 40% of its losses last week. More than 85% of the stocks in the benchmark index gained ground. The Dow Jones Industrial Average rose 2.1% and the Nasdaq climbed 2.5%.

“This is a little more of an oversold bounce that the market is looking at and trying to figure out what is the path the Federal Reserve is actually going to navigate,” said Rob Haworth, senior investment strategist at U.S. Bank Wealth Management.

Technology stocks had some of the strongest gains. Apple rose 3.3% and Microsoft rose 2.5%.

Retailers, health care companies and banks also made solid gains. Kellogg rose 2% after the maker of Frosted Flakes and Rice Krispies said it would split into three companies. Spirit Airlines jumped 7.9% after JetBlue sweetened its buyout offer for the budget airline.

European markets ended mostly higher, while Asian markets closed mixed overnight. The yield on the 10-year Treasury rose to 3.30% from 3.23% late Friday. Markets were closed Monday for the observation of Juneteenth.

All told, the S&P 500 rose 89.95 points to 3,764.79. The index remains stuck in a slump, though, along with every other major index, and is still down 21.5% from the record high it set in January. It’s posted a weekly loss in 10 out of the last 11 weeks.

The Dow rose 641.47 points to 30,530.25, while the Nasdaq added 270.95 points to 11,069.30.

Smaller company stocks also gained ground. The Russell 2000 rose 28.34 points, or 1.8%, to 1,694.03.

Stocks have been mostly sliding in recent weeks as investors adjust to higher interest rates that the Federal Reserve and other central banks are increasingly doling out. The aggressive rate hikes are part of a plan to temper record-high inflation, but investors are worried that the Fed risks slowing economic growth too much and bringing on a recession.

The worries over inflation and interest rates have been worsened by a spike in energy prices following Russia’s invasion of Ukraine. The price of U.S. crude oil rose 1% to settle at $110.65 per barrel today. It’s up about 52% for the year. That has taken a bigger bite out of people’s wallets at the gas pump and is prompting a slowdown in spending elsewhere.

The lingering list of worries has made for an extremely turbulent market. Daily swings between gains and losses has been common and major indexes have sometimes shifted between sharp gains and losses on an hourly basis.

“In these kinds of markets, you just get bigger volatility in both directions,” said Ross Mayfield, investment strategist at Baird. “The entire market is being shaped by the Fed and inflation numbers.”

Last week, the Fed hiked its key short-term interest rate by triple the usual amount. It has also just begun allowing some of the trillions of dollars of bonds it purchased through the pandemic to roll off its balance sheet. That should put upward pressure on longer-term interest rates and is another way central banks are yanking supports earlier propped underneath markets to bolster the economy.

The Fed’s moves are happening as some discouraging signals have emerged about the economy, including sagging spending at retailers and soured consumer sentiment. The National Association of Realtors today reported that sales of previously occupied U.S. homes slowed for the fourth consecutive month. The housing market, a crucial part of the economy, is slowing as homebuyers face record high prices and sharply higher home financing costs than a year ago following a rapid rise in mortgage rates.

Wall Street will be closely listening for clues about the Fed’s plans for possible additional rate hikes when Powell speaks before Congress this week. The central bank could consider another such mega-hike at its next meeting in July, but Powell has said increases of three-quarters of a percentage point would not be common.