NEW YORK (AP) — U.S. stocks are slightly higher in unsteady trading one day after their biggest drop since February. A report indicating that inflation remains limited seemed to calm U.S. investors.

Following yesterday's sell-off in the U.S., markets in Asia tumbled and European stocks suffered more modest losses.

Bond yields, which have spiked over the last week, slid after the Labor Department said consumer prices grew only slightly in September. That's a sign inflation remains under control and it suggests the Federal Reserve won't have to raise interest rates at a faster pace.

The market's recent decline was set off by a sharp drop in bond prices and a corresponding increase in yields last week and early this week. Yields slipped Thursday, as it appears investors are more interested in government bonds now that their prices are lower and their returns look better.

The benchmark S&P 500 index added 4 points, or 0.2 percent, to 2,789 at 9:55 a.m. after it fell 3.3 percent Wednesday, and the Dow Jones Industrial Average added 34 points, or 0.1 percent, to 25,663 after an 831 point plunge. Technology and internet companies recovered slightly after big losses over the past week, but energy companies fell along with oil prices.

The Nasdaq composite gained 55 points, or 0.7 percent, to 7,476 after a 4.1 percent dive that was its biggest one-day loss in two years. The Russell 2000 index of smaller-company stocks inched up 1 point, or 0.1 percent, to 1,576.

France's CAC 40 dropped 1.2 percent and the DAX in Germany lost 0.8 percent. Britain's FTSE 100 sank 1.5 percent. In Asia, Tokyo's Nikkei 225 gave up 3.9 percent and Hong Kong's Hang Seng index shed 3.5 percent. The Kospi in South Korea fell 4.4 percent.

"Equity investors are surprised by the pace at which rates have risen," Marcella Chow, global market strategist at J.P. Morgan Asset Management, said in a report.

The Labor Department's index of consumer prices edged up 0.1 percent in September as energy prices retreated after a big gain in August. Inflation has risen slightly this year after a prolonged stretch when prices stayed below the 2 percent target set by the Federal Reserve. For the 12 months ending in September, consumer prices were up 2.3 percent.

Bond prices rose as the recent surge in yields attracted the attention of some investors. The yield on the 10-year Treasury note fell to 3.17 percent from 3.22 percent late Wednesday. That's still sharply higher than it was a week ago, and earlier this week the yield on the 10-year note reached its highest level since mid-2011.

Technology companies edged higher after taking a beating on Wednesday. Apple rose 0.9 percent to $218.29 and Microsoft gained 1.6 percent to $107.91. Alphabet, Google's parent company, bounced 1.9 percent to $1,113.33. But Amazon fell another 1.7 percent to $1,725.04.

All of those stocks have made strong gains this year, but Alphabet and Amazon are now in what's known as a "correction," a drop of more than 10 percent from a recent peak. They are the second- and fourth-most valuable U.S. companies. Facebook, which ranks sixth, has tumbled 30 percent since late July, and Netflix has fallen more than 20 percent, meeting the threshold for a "bear market."

U.S. crude gave up 1.4 percent to $72.13 a barrel in New York. Brent crude, the international standard, dropped 2 percent to $81.39 a barrel in London. The price of gold jumped 1.4 percent to $1,210.70 an ounce.

On Wednesday, U.S. President Donald Trump said the Federal Reserve "is making a mistake" with its campaign of rate increases and said the central bank "has gone crazy" by gradually raising interest rates over the last three years.

Sentiment also has been dimmed by the spreading U.S.-Chinese tariff fight over Beijing's technology policy. The International Monetary Fund cut its outlook for global growth this week, citing interest rates and trade tensions.

The U.S. Treasury is due to release a currency report that some analysts suggest might change the official stance on China's exchange rate policy. Chow said it was unclear whether the Treasury might label Beijing a "currency manipulator" — a status that could trigger penalties — or whether it could be "another pretext for the next round of tariffs."

Adding to potential U.S.-China tensions, the Justice Department announced Wednesday it arrested an official of China's Ministry of State Security on charges of trying to steal trade secrets from U.S. aerospace companies.

Technology stocks have taken the brunt of the losses. Tencent, China's most valuable tech company, dropped 6.8 percent. Shares of Chinese smartphone maker Xiaomi Corp. fell by 8 percent.

Francis Tan, an investment strategist at UOB Private Bank, says "the valuation of U.S. stocks, especially tech stocks, is still pretty high," and investors could be tempted to not buy into them yet.

The dollar fell to 112.44 yen from 112.59 yen, and the euro rose to $1.1572 from $1.1525.

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AP Business Writers Annabelle Liang in Singapore and Joe McDonald in Beijing contributed to this report.