The Standard & Poor's 500 index rose 18.68 points, or 0.7 percent, to 2,786.24.
Another data showed USA consumer prices recorded their biggest rise in 11 months in December on gains in the cost of rental accommodations and healthcare, bolstering expectations that inflation will accelerate this year. It had climbed as high as 2.59 percent on Wednesday.
Bank stocks also gained from a rise in Treasury yields after underlying USA consumer prices for December posted their biggest gain in 11 months, signaling a pickup in inflation.
Investors have been preparing for a gradual rise in rates, as the Federal Reserve slowly removes the aid it provided the economy following the Great Recession.
Strategists at Goldman Sachs say the tax overhaul will contribute more than a third of the expected 14 percent growth they're forecasting for S&P 500 earnings per share.
The losses were steeper in the morning, when the yield on the 10-year Treasury approached 2.60 percent.
"We're not fully invested at this point, but we haven't switched to pure defense yet either", Villere said.
"We're all anticipating rising rates, and have been for some time", Severinovsky said.
A report from Bloomberg News said that China is considering a slowdown or halt to its purchases of Treasurys, which helped push rates higher.
Benchmark U.S. crude added 61 cents to settle at $63.57 per barrel. Brent crude, the worldwide standard, gained 61 cents to $69.87 per barrel.
Health care stocks rose 1.1 percent for the biggest gain among the 11 sectors that make up the S&P 500.
The Nasdaq is up 308.39 points, or 4.5 percent.
The stock market has repeatedly shrugged off concerns through its placid ride to records.
The powerful combination has kept markets marching higher even though stock prices have grown to become more expensive than usual, relative to corporate profits. The Nasdaq Composite Index was down 10.01 points, or 0.14 percent, to 7,153.57.
That's rewarded investors who have repeatedly "bought the dip" and seen every wobble in prices as a buying opportunity. The Nasdaq composite fell 25 points, or 0.4 percent, to 7,137.
The next tests for companies will arrive in coming weeks, as they report their results for the last three months of 2017.
Businesses will need to produce strong growth to justify the gains their stocks have made, and expectations are also high that CEOs will unveil encouraging profit forecasts for 2018 after Washington cut their income-tax rates.
The index is already up more than 4 percent for 2018.
The dollar fell to 112.61 Japanese yen from 113.07 yen late Monday.
Advanced Micro Devices (AMD.O) fell 1.61 percent after the chipmaker said its microprocessors are prone to both variants of the Spectre security flaw, days after saying its risk for one of them was "near zero".