By Yasin Ebrahim

Investing.com — The S&P 500 surged Wednesday, on hopes of a diplomatic resolution to the Russia-Ukraine war after Ukraine said it was open to discussing Russia’s demand for neutrality, which could prove key in ending the conflict.

The index rose 2.6% while the gain 2% or 653 points was recorded.

“U.S. equity markets are rallying this morning, as favorable geopolitical chatter and bargain buying work to reduce oversold chart conditions on benchmarks like the S&P 500,” Janney Montgomery Scott said in a note.

Ukraine reportedly said it was open to discussing Russia’s demand of neutrality in exchange for security guarantees.

Although still in its infancy, the prospect of a diplomatic solution to Russia-Ukraine’s crisis has cooled commodity prices, including energy, as well as worries about long-term effects on global growth.

Market rebound led to the recovery of technology stocks as well as financial stocks. The latter was boosted by an increase in banks and rising Treasury yields.

Signature Bank (NASDAQ :), Bank of America NYSE:, Fifth Third Bancorp NASDAQ : were higher than 6%.

The broader market melt down was also a result of big tech, including Microsoft (NASDAQ) and Google (NASDAQ).

Apple (NASDAQ: ) rose more than 33% on the heels of a number of new products by the tech company, including a refreshed iPhone and M1 chip.

Netflix (NASDAQ: ) surged 5% upon Wedbush elevating its rating for the streaming company from an underperform rating to a neutral rating.

Oil prices falling has provided fuel-sensible sectors, such as airlines and cruise ships, an increase.

Carnival (NYSE :), Norwegian Cruise Line (NYSE :), American Airlines(NASDAQ:), United Airlines, (NASDAQ 🙂 all saw significant increases.

This rebound comes just one day before an inflation report that is expected to reveal that consumer prices increased nearly 8% over the twelve months ending February.

Despite forecasts for slower growth, it is likely that the economy will remain strong as consumer spending, which amounts to 66%, shows little signs of restraint.

“The inability to identify early warning signs of consumer spending declines like trading down and substitutions [reflects] the ability of the consumer to continue to spend money,”  Sarah Henry, portfolio manager at Logan Capital Management said in an interview with Investing.com on Wednesday. They’re willing to continue paying the same amount they paid for during the pandemic.