(Reuters) – The New York Stock Exchange opened higher on Tuesday as U.S. Treasury bond yields fell following dovish comments from Federal Reserve (Fed) officials, although caution prevailed amid escalation of tensions in the Middle East.

In early trading, the Dow Jones index gained 96.91 points, or 0.29%, to 33,701.56 points and the broader Standard & Poor’s 500 rose 0.19% to 4,344.03 points.

The Nasdaq Composite takes 0.15%, or 20.61 points, to 13,504.85.

Market sentiment was supported Tuesday by statements from Fed officials who indicated that rising yields on long-term U.S. Treasuries could prompt the central bank not to raise its benchmark rate further in the short term.

After these comments and the day after a public holiday, the yield on 10-year Treasury bonds reached its highest level in 16 years.

“Although the violence in the Middle East is seen as having only limited fallout at the moment, it has nonetheless added a new layer of uncertainty… so the Fed’s change in tone is welcome.” , said Raffi Boyadjian, analyst at currency broker XM.

Geopolitical tensions, however, call for caution. Israel said Tuesday it had regained control of the border with the Gaza Strip and the country recalled hundreds of thousands of reservists.

In values, PepsiCo takes 0.75% after raising its annual profit forecast on Tuesday for the third time of the year, the company banking on multiple price increases and the resilience of demand for its snacks and drinks.

Unity gained 3.91% after the announcement that its CEO would leave the company with immediate effect.

Rivian gains 3.35% after UBS raised its recommendation from “neutral” to “buy”.

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(Writing by Augustin Turpin and Diana Mandia, editing by Kate Entringer)

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