Stocks rose in volatile trade on Thursday, rebounding from steep losses earlier in the session, as traders assessed the latest US inflation data and what it means for the Federal Reserve going forward.

The Dow Jones Industrial Average rose 638 points, or 2.19%, recovering from a 500-point decline earlier in the day. The S&P 500 rose 1.73% and the Nasdaq Composite gained 1.12%.

Stocks rebounded after hitting their lowest levels since 2020, driven by gains in energy and banking stocks. Shares of Chevron gained more than 3% as oil prices soared, and bank stocks Goldman Sachs and JPMorgan rose 2.9% and 4%, respectively. A reversal in big tech names such as Apple and Microsoft and a rise in semiconductors Nvidia and Qualcomm also contributed to the rise.

Also, investors may be betting that the stronger-than-expected inflation report means that price increases will soon peak.

“We get this last burst of inflation and from there we start to slow down,” said Liz Ann Sonders, chief investment strategist at Charles Schwab. She added, however, that the swings in equities are likely to continue as investors digest more inflation data and earnings season kicks off.

“I think there are still a lot of things that could lead to volatility and intraday fluctuations are just the nature of the beast right now,” she said.

Stocks fell to session lows when the September consumer inflation report showed a bigger-than-expected rise. The consumer price index rose 0.4% for the month, more than the Dow Jones estimate of 0.3%. On an annual basis, inflation increased by 8.2%.

Thursday’s CPI report comes a day after the government said the producer price index, another gauge of inflation, rose more than expected.

Investors also digested the Federal Reserve’s September meeting minutes, released Wednesday. Minutes showed that the central bank expected to keep raising interest rates until it saw inflation come down. But one comment has some thinking the Fed could instead slow rate hikes, or even reverse them, if the tumult in financial markets continues.

Going forward, investors will be watching for the start of the earnings season. On Friday, major banks JPMorgan Chase, Wells Fargo, Morgan Stanley and Citigroup all released their results.