U.S. stocks close higher, rebound from biggest selloff this year

U.S. stocks closed higher Thursday, as Wall Street tried to recover from Wednesday's selloff, the biggest one of 2017.

The Dow Jones Industrial Average was up 56.09 points, or 0.27 percent, to 20,663.02. The S&P 500 rose 8.69 points, or 0.37 percent, to 2,365.72. The Nasdaq Composite Index gained 43.89 points, or 0.73 percent, to 6,055.13.

U.S. equities suffered their worst day so far this year Wednesday, with all three major indices dropping over 1.5 percent, due to the latest turmoil in Washington that triggered market concerns on whether the Trump administration could continue to push its economic reform agenda.

The White House earlier this week pushed back against a new wave of media allegations that Trump might have tried to obstruct justice by asking then FBI Director James Comey to end a probe into former national security adviser Michael Flynn.

"I hope you can let this go," Trump told Comey at the time, according to a New York Times report, quoting two people who read the memo Comey wrote shortly after meeting with Trump in the Oval Office one day after Flynn resigned over a Russia-related scandal in February.

"The market is responding to the probability that tax reform, infrastructure spending, healthcare reform and trade deals might not occur," Brendan Ahern, chief investment officer of Krane Funds Advisors, told Xinhua.

Even though investors were shocked by the news, analysts said uncertainty in Washington is unlikely to derail the stock rally in the long run.

On the economic front, in the week ending May 13, the advance figure for seasonally adjusted initial claims was 232,000, a decrease of 4,000 from the previous week's unrevised level of 236,000, according to the U.S. Labor Department Thursday.

The 4-week moving average was 240,750, a decrease of 2,750 from the previous week's unrevised average of 243,500. Endit