The stock market recovered from a midday stumble and ended higher, staying on track for its first weekly gain in four weeks. The S&P 500 rose 0.66% Thursday. The Nasdaq composite and the Dow Jones Industrial average also ended higher, just about in lockstep (up 0.60% and 0.61%)  after bumpy rides of their own.

Interest rate policies were in focus as the European Central Bank made its largest-ever rate increase, in line with moves from the U.S. Federal Reserve and other central banks to fight inflation.

Meanwhile Fed Chair Jerome Powell reaffirmed the Fed’s commitment to keep rates high “until the job is done” in getting inflation under control.

Stocks have been mostly losing ground in recent weeks after the Federal Reserve indicated it will not let up anytime soon on raising interest rates to bring down the highest inflation in decades.

Health care stocks accounted for a big share of the S&P 500's gains. Regeneron Pharmaceuticals surged 19.5% after the company and partner Bayer reported encouraging study data on an anti-blindness drug.

Banks also helped lift the market. JPMorgan Chase rose 2%.

Big technology and communications stocks were among the biggest losers. Apple fell 1.1% and Google's parent company fell 1.1%.

Bond yields rose. The yield on the 10-year Treasury, which influences interest rates on mortgages and other loans, rose to 3.30% from 3.27% late Tuesday. The two-year Treasury yield, which tends to track expectations for Fed action, rose to 3.49% from 3.44%.

Interest rates policies were in sharp focus for investors as the European Central Bank made its largest-ever rate increase, in line with moves from the Fed and other central banks to fight inflation. The bank’s 25-member governing council raised its key benchmark by three-quarters of a percentage point Thursday.

Meanwhile Fed Chair Jerome Powell reaffirmed the Fed’s commitment to keep rates high “until the job is done” in getting back down to its 2% goal.

“There is a record of failed attempts to get inflation under control, which only raises the ultimate costs to society,” he said during a conference on monetary policy by the Cato Institute, a think tank that promotes libertarian ideas.

The central bank has already raised rates four times this year and markets expect it to deliver another jumbo-sized increase of three-quarters of a percentage point at its next meeting in two weeks.

One of the Fed’s biggest fears is that households and businesses begin to expect inflation to stay high in the long term, which could lead them to start buying in a way that creates a vicious cycle making inflation even harder to shake.

The Fed has caught criticism for not taking inflation seriously sooner, and Powell said that setting interest-rate policy is an art as much of a science. A big question remains about whether the high inflation ravaging economies around the world is a one-off created by the pandemic or the start of something more persistent.

Markets in Europe closed higher and markets in Asia closed mixed. Japan's benchmark Nikkei 225 surged 2.3%.