The Dow Jones Industrial Average opened above the 24,000 mark for the first time on Thursday, supported by a rebound in technology stocks and progress on President Donald Trump's tax-cut plan.
Republican Senator John McCain's decision to back the tax bill provided a new jolt of momentum for the legislation.
McCain, who had voted against the healthcare overhaul effort this summer, is considered a critical vote for the Republican effort. The Dow gave back 65 points to slip to 23092.
"While the market has definitely run in anticipation of tax reform, there is still some sort of scepticism", said Lindsey Bell, investment strategist CFRA Research.
The Dow Jones industrial average gained 331 points, or 1.4 percent, to 24,272.
The S&P 500 index climbed 21.51 points, or 0.8 percent, to 2,647.58.
Tech heavyweights such as Apple and Facebook, the worst hit in Wednesday's sell-off, boosted the indexes on Thursday.
The market has priced in only a 20 percent to 40 percent probability of tax cuts, according to UBS strategists. On the Nasdaq, 1,686 issues rose and 1,171 fell.
Kroger jumped 6.1 per cent as the supermarket chain reported slightly higher third-quarter earnings of US$397 million compared to the year-ago period as comparable sales rose 1.1 per cent.
Reports that pointed to sustained increase in underlying price pressures and a drop in first-time applications for unemployment benefits also helped sentiment.
Advancing issues outnumbered declining ones on the NYSE by a 1.41-to-1 ratio; on Nasdaq, a 1.13-to-1 ratio favoured advancers.
The Nasdaq is up 1,490.86 points, or 27.7 percent.