The three major indexes are on track to snap their longest weekly losing streaks in decades.
The Dow Jones Industrial Average rose 1.65%, the S&P 500 gained 1.33% and the Nasdaq Composite added 0.76% in choppy trade.
Major indices were down about three percent heading into Friday's session, pressured by recession fears following poor results from US retailers that underscored the risks around higher inflation.
The stocks nosedived after Target Corp's first-quarter profit halved and the company warned of a bigger margin hit on rising fuel and freight costs. Its shares fell 25.2% and were tracking their worst day since the Black Monday crash on Oct. 19, 1987.
The S&P 500 fell 1.6% as of 10:23 a.m. Eastern. The Dow Jones Industrial Average fell 456 points, or 1.4%, to 32,197 and the Nasdaq fell 1.6%.
Nine of the 11 major S&P sectors advanced in morning trade, with financials up 2.3% and technology 1.8%.
The S&P 500 was 2.6% lower in midday trading after coming off its fifth straight losing week, its longest such streak in more than a decade.
The US central bank on Wednesday raised interest rates by half a percentage point but Fed Chair Jerome Powell explicitly ruled out a hike of 75 basis points in a coming meeting. Traders, however, on Thursday raised their bets on a 75 basis point hike at the Fed's June meeting.
The Dow Jones Industrial Average fell 438.09 points, or 1.29%, to 33,611.37; the S&P 500 lost 73.1 points, or 1.70%, to 4,223.02; and the Nasdaq Composite dropped 347.48 points, or 2.67%, to 12,657.37.
At 10:03 a.m. ET, the Dow Jones Industrial Average was down 415.23 points, the S&P 500 was down 56.93 points, and the Nasdaq Composite was down 104.93 points.
Stocks were up in early trading, with the Dow Jones Industrial Average rising 0.22%, the S&P 500 climbing 0.25% and the Nasdaq Composite up 0.23%.
Seven of the 11 major S&P 500 sectors advanced in early trading, led by gains in energy and material stocks.
The benchmark S&P 500 index, however, has rebounded more than 5% this month on upbeat economic data and a recovery in megacap stocks.
The Dow Jones Industrial Average fell 197.09 points, or 0.57%, to 34,557.84, the S&P 500 lost 17.31 points, or 0.39%, to 4,445.81 and the Nasdaq Composite dropped 160.70 points, or 1.16%, to 13,733.14.
Microsoft Corp and Broadcom Inc gained 1.6% and 3.9%, respectively, providing the biggest boost to the S&P 500 and the Nasdaq.
The S&P 500 banks index added 4.5%, powered by a 5.4% rise in Bank of America.
About 15 minutes into trading, the Dow Jones Industrial Average was down 1.2 percent at 33,657.92. The broad-based S&P 500 dropped one percent to 4,340.69, while the tech-rich Nasdaq Composite Index shed 0.9 percent to 13,574.60.
The early gains Friday came after US equities reversed themselves Thursday and pushed higher amid sentiment that share prices had fallen too much.
A pan-European equity index (.STOXX) rose 1.28% while Japan's blue-chip Nikkei (.N225) rose 0.28%, with MSCI's world stock index up 0.85% after hitting its highest in over a week.
Wall Street edged higher on Monday after a rise in European shares helped stabilize investor sentiment after a series of volatile sessions
The S&P 500 fell 0.1% as of 10:23 a.m. Eastern and is close to shedding more than 10% of its value from the record high it set on January 3, which puts it on track to close in what market watchers call a correction.
The Dow Jones Industrial Average fell 10.02 points, or 0.03%, at the open to 36,058.85.
The US consumer price index rose 0.9% in October after gaining 0.4% in September, accelerating 6.2% in the 12 months through October, the largest year-on-year advance since November 1990.
Technology stocks led the gains as investors continued their focus on the latest round of corporate earnings.
Major indices have closed at records the last three sessions, but were under pressure ahead of an expected Fed announcement later Wednesday to trim back stimulus bond purchases.