Wall Street rallied Thursday, after a severe routing on Wednesday that saw all three major indices notch their biggest declines of the year on fears of an impending recession.

The Dow Jones Industrial Average gained around 100 points, with the S&P 500 notching up gains of just under 0.4 percent and the Nasdaq climbing by around 0.3 percent.

Thursday's return to normality was a stark contrast to Wednesday's market activity, when all three major indices lost around 3 percent of their value after the yield on the benchmark 10-year Treasury note fell below the 2-year rate, and data from China and Germany showed continued economic contraction.

Global markets continued their tumble overnight, after China vowed to retaliate for President Donald Trump's latest round of tariffs, but quickly recovered after Beijing signaled a willingness to compromise.

China’s Foreign Ministry said Thursday it “hopes the U.S. side will meet China halfway, and implement the consensus reached by the two leaders during their meeting in Osaka.”

A positive quarterly earnings report from Walmart, which had earlier warned it would be forced to raise prices on a number of products due to the increase in tariffs, gave the stock market an additional boost. Alibaba, China's equivalent of Amazon, recorded a 42 percent increase in revenue, edging up markets in Asia.

Trump reignited tensions between the two sides earlier this month when he said he would impose an additional 10 percent tariff on $300 billion of mainly consumer goods imported from China, starting on Sept. 1. Earlier this week, the White House said it would delay taxing some items until Dec. 15.

Trump blamed the Federal Reserve for Wednesday's market dive, branding Fed Chairman Jerome Powell as "clueless" for not easing monetary policy as central banks in other countries have done. With the economy as the central focus of his re-election campaign, Trump has continually berated Powell for not slashing rates sooner, despite the Fed's quarter-point-percentage cut last month.

While some market observers concede that the Fed should trim rates, Trump's chaotic and sometimes contradictory trade rhetoric has left many U.S. businesses struggling to find clarity — a situation that will become all the more critical as the holiday season approaches.