The major domestic equity indexes rose sharply on Thursday, bringing an upbeat end to a tumultuous, holiday-shortened week as technology stocks rebounded At the same time, the S&P 500 index and the Dow Jones Industrial Average posted their biggest quarterly declines in more than two years.

The year started strong, but early gains evaporated as the markets entered a correction over interest rate jitters, fears of an escalating import tariff dispute between the United States and China, and a selloff in the tech sector.

Tech stocks reversed course on Thursday and the S&P 500 information technology index ended the trading day on Thursday up 2.2 percent after reaching a session high of 3.2 percent, helping push the S&P 500 up 1.4 percent, with the Dow and Nasdaq also rallying.

Technology gains were led by Facebook, Intel, Alphabet, and Microsoft.

Investors were unfazed by economic reports showing a slight increase in consumer spending and initial jobless claims dropping to a more than 45-year low.

In other data, core personal consumption expenditures (PCE) rose by 1.6 percent year-on-year. The index, the Federal Reserve’s preferred measure of inflation, has been below the Fed’s 2 percent target since mid-2012.

Amazon ended the trading day up 1.1 percent, recovering from a 4.6 percent drop after Trump criticized the online retailer via Twitter early Thursday, claiming without evidence that the company pays “little to no taxes to state & local governments.”

Shares gained in price earlier in the week as comments from officials in the United States and China suggested the world’s two largest economies would renegotiate tariffs and trade imbalances, averting a trade war.

However, concerns that retaliatory tariffs would harm the global economy led investors to cut equity exposure to a four-month low in March and reduced holdings of domestic equities to their lowest level in nearly two years, according to a Reuters poll.

Approximately 7.49 billion shares changed hands on the major domestic equity exchanges on Thursday, as compared to the 7.29 billion share average over the past 20 trading days.

Day’s Economic News

Consumer spending rose marginally for a second straight month in February as households increased savings levels, the latest indication that the economy lost momentum in the first quarter.

Nonetheless, the economy’s fundamentals remain strong, with other data on Thursday indicating that claims for unemployment benefits fell to a 45-year low last week. A tightening labor market is expected to start driving up wages by the second half of this year.

Consumer spending has been tepid this year despite strong consumer confidence, which has been bolstered by income tax cuts. Some economists said the tax cuts, which came into effect in January, only reflected on most workers’ paychecks in late February. They also believed that delays in processing tax refunds had contributed to holding back spending.

The Commerce Department indicated on Thursday that consumer spending, which accounts for more than two-thirds of all domestic economic activity, increased 0.2 percent last month after a similar gain in January.

It was supported by a rebound in spending on long-lasting goods, such as motor vehicles, as was a rise in financial services and insurance expenditures. The increase in consumer spending in February was in line with economists’ expectations.

There was also a moderation in monthly inflation readings after prices pushed higher in January. The personal consumption expenditures (PCE) price index excluding the volatile food and energy components rose 0.2 percent last month after advancing 0.3 percent in January.

That lifted the year-on-year increase in the core PCE price index to 1.6 percent, the largest gain since February 2017, from 1.5 percent in January. The core PCE index is the Federal Reserve’s preferred inflation measure. It has been below the Fed’s 2 percent target since mid-2012.

The consensus is that the annual core PCE price index could accelerate to 1.9 percent in March as last year’s weak readings drop out of the calculation.

The steady rise in inflation last month also helped curb consumer spending. When adjusted for inflation, consumer spending was unchanged in February after falling 0.2 percent in the prior month. That suggests a sharp slowdown in consumer spending in the first quarter after it surged at an eye-popping 4.0 percent annualized rate in the fourth quarter.

The tepid consumer spending added to data on trade, housing and business spending on equipment that have left economists anticipating moderate economic growth in the first quarter.

Data forecasting firm Macroeconomic Advisers cut its first-quarter GDP growth estimate by three-tenths of a percentage point to a 1.5 percent rate. Economists at Barclays lowered their forecast to a 1.7 percent rate from 1.8 percent. The economy grew at a 2.9 percent pace in the fourth quarter.

In February, personal income rose 0.4 percent, matching the increase of the previous two months. Wages increased 0.5 percent last month after climbing 0.6 percent in January.

Savings increased to $497.4 billion in February, the highest level since August 2017, from $471.3 billion in the prior month. That raised the saving rate to a six-month high of 3.4 percent from 3.2 percent in January.

Income growth could pick up as the labor market tightens further, which should help to support consumer spending.

In a separate report on Thursday, the Labor Department reported that initial claims for state unemployment benefits fell by 12,000 claims to seasonally adjusted 215,000 claims for the week ended March 24, the lowest level since January 1973.

The labor market is at or near full employment. The jobless rate is at a 17-year low of 4.1 percent, not too far from the Fed’s forecast of 3.8 percent by the end of this year.