"Once you have a good lift in the market like yesterday, it's going to take a little more confidence that it can be sustained, especially at the valuations we're at," Omar Aguilar, chief investment officer for equities at Charles Schwab Investment Management in San Francisco, told Reuters.
"We need to have a little more calm down on the political front and geopolitical side."
Indeed, Bank of America Merrill Lynch's monthly fund manager poll showed 46 per cent, or a record high, said equity markets are overvalued.
"Investors' expectations of corporate profits have taken an ominous turn this year," Michael Hartnett, BofA Merrill Lynch Global Research chief investment strategist, noted, "which is a warning sign for equities over bonds, high yield over investment grade, and cyclical sectors over defensive ones. Further deterioration is likely to cause risk-off trades."
The Dow rose as gains in shares of American Express and those of Apple, recently up 1.7 per cent and 1.1 per cent respectively, outweighed slides in shares of Home Depot and those of Nike, recently down 3.1 per cent and 2.1 per cent respectively.
Wall Street's fear gauge-the CBOE Volatility Index eased 3.2 per cent to 11.93.
In Europe, the Stoxx 600 Index finished the day with a 0.1 per cent rise from the previous close. Germany's DAX Index increased 0.1 per cent, the UK's FTSE 100 Index rose 0.4 per cent, while France's CAC 40 Index also added 0.4 per cent.
Shares of Danone rose after Bloomberg reported, citing people familiar with the matter, that Corvex Management has built a stake in the French yogurt maker because it views the company as significantly undervalued.
The New York-based activist fund run by Keith Meister owns shares in Danone worth about US$400 million, said the people, who asked not to be identified because the investment hasn't been publicly disclosed, according to Bloomberg.
The stock rose as much as 2.9 per cent in early Paris trading, leading gains in France's benchmark CAC 40 Index, before ending the day with an increase of 1 per cent from the previous close.