The S&P 500 added 0.2 percent, putting its weekly gains at 4 percent. But if prices start to rise as the recovery gains steam, the Fed would probably raise interest rates - pushing up long-term Treasury yields even more.
Reacting to the gyrations, MUFG Union Bank chief financial economist Chris Rupkey wrote that "we think the stock market will settle down and decide that it likes Trump". Higher interest rates help banks earn more money from lending, and years of ultra-low rates have crimped profits at big banks.
JPMorgan Chase led the 30 companies in the Dow, climbing 3.40 dollars, or 4.6%, to 76.65 dollars. (NASDAQ:AMZN) that dropped nearly two percent each. The stock added $2.90 to $97.86.
After the bell, Nordstrom (JWN.N) reported quarterly results that sent its shares 5% higher while Walt Disney's (DIS.N) quarterly report pushed its stock down 2.6%.
The biggest gainers on the FTSE 100 were BT Group, up 13.15p to 361p; Marks and Spencer Group, up 10.4p at 327.2p; Next, up 149p at 5,040p; and Severn Trent, up 47p at 2,177p.
TECH SLIDE: Some big names in the technology sector were trading lower. Murphy Oil slumped 5 percent.
The Nasdaq composite underperformed, erasing earlier gains and briefly falling 2 percent as the iShares Nasdaq Biotechnology ETF (IBB) (IBB) pared initial gains while the so-called FANG stocks (Facebook (FB), Amazon (AMZN), Netflix (NFLX) and Alphabet (GOOGL)) fell.
Shares in several phone companies also slumped.
Stocks are moving lower in midday trading on Wall Street as a post-election rally fades.
Weed the real victor on election night
California's Proposition 64 was supported by 56% of the state's voters, while Nevada's Question 2 passed with 54% approval. In Arizona , 52% of voters just said no to passing a measure that would have legalized marijuana in the state.
In the 22 elections going back to 1928, the S&P 500 has fallen 15 times the day after polls close, for an average loss of 1.8 percent.
But investors quickly shook off fears about a Trump presidency and focused on some of the policy changes that might be beneficial to financial markets, including tax cuts, a crackdown on regulation and infrastructure spending.
Markets in Asia fared better.
Declining issues outnumbered advancing ones on the NYSE by 1,693 to 1,219. Australia's S&P/ASX 200 surged 3.3%. Benchmark U.S. crude fell 61 cents, or 1.3%, to close at 44.66 dollars a barrel in NY.
US crude for December delivery (New York Mercantile Exchange: @CL.1) fell 1.35 percent, or 61 cents, to settle at $44.66 per barrel.
Other global market indicators also showed signs of calm after Tuesday night uneasiness. AT&T lost 89 cents, or 2.4 percent, to $36.55, while Verizon slid $1.14, or 2.4 percent, to $46.72. Gold futures for December delivery (CEC:Commodities Exchange Centre: @GC.1) fell $7.10 to settle at $1,266.40 per ounce.
The S&P 500 is up 79.27 points, or 3.8 percent. The dollar index, which tracks the performance of the greenback against a basket of six currencies, rose 0.3% to a two-week high of 98.81.
US stock index futures rose Thursday ahead of the opening bell, CNBC reported.