The S&P 500 recovers after two consecutive days of decline due to the Federal Reserve.

On Thursday, stocks bounced back after two consecutive days of losses, as investors reevaluated the Federal Reserve's recent strategy to curb inflation and tighten monetary policy.

The Dow Jones Industrial Average, S&P 500, and Nasdaq Composite all experienced gains after dropping earlier in the session. The Dow rose 87.06 points or 0.25%, to 34,583.57, while the S&P 500 advanced 0.43% to 4,500.21. The Nasdaq Composite inched up 0.06% to 13,897.30, following two straight days of losses.

Stocks with defensive names such as consumer staples and health-care companies led the market recovery on Thursday as investors continued their search for stocks with stable earnings and dividends. Costco, Pfizer, Johnson & Johnson, and Procter & Gamble all experienced gains for the day.

After reporting earnings, the stock price jumped 4.6% and nearly 8%, respectively.

Tesla's stock price increased by 1.1%, while Twitter's decreased by 5.4%. HP Inc's shares rose by approximately 15% after Berkshire Hathaway revealed its investment in the tech hardware company.

"Not surprising are the moves, as Timothy Lesko, senior wealth advisor at Mariner Wealth Advisors, stated. The market is attempting to determine valuations in a higher interest rate environment. Each piece of economic news adjusts the forward expectation at the margin, and the market must learn to adapt."

Since the start of the week, the Nasdaq dropped 2.55%, while the S&P 500 fell 1%. Despite this, the S&P 500 was still more than 6% away from its all-time high at the close.

"According to Credit Suisse's David Sneddon, the S&P 500 has been facing pressure in recent sessions, but key support at 4455/50 remains intact. However, a break below this level would increase short-term risks and push them outside the range. Additionally, concerning is the increase in volume as the market falls."

The Fed released minutes from its March meeting on Wednesday, indicating that officials planned to reduce their trillions in bond holdings with a consensus amount around $95 billion. Meanwhile, policymakers suggested that one or more 50 basis-point interest rate hikes could be necessary to combat inflation.

According to Charlie Ripley, senior investment strategist at Allianz Investment Management, the minutes from the latest FOMC meeting reveal a higher level of urgency than previous communication, as the Fed has indicated a commitment to run the balance sheet down faster than market participants may have anticipated.

Officials generally agreed that a maximum of $60 billion in Treasurys and $35 billion in mortgage-backed securities would be allowed to roll off, phased in over three months and likely starting in May.

On Thursday, investors monitored the ongoing Ukraine-Russia war as Ukraine requested more weapons from NATO and the EU and U.S. considered imposing a ban on Russian coal. Meanwhile, the U.S. Senate passed a bill prohibiting Russian oil and gas imports.

On Thursday, crude prices continued to decline, with U.S. oil falling 0.6% to $96.03 per barrel and international Brent sliding 0.5% to $100.58. The volatility of crude prices has been influenced by the ongoing conflict in Ukraine.