Stocks and bond yields punched higher Wednesday after more reports showed the U.S. economy continues to strengthen. The encouraging data could push the Federal Reserve to raise interest rates more aggressively from the record lows marked during the Great Recession than investors were expecting.

ON WALL STREET: At the close, the Standard & Poor’s 500 index was up 11.7 points, about 0.5 percent, at 2,349.3. The Dow Jones industrial average rose 107.5 points, about 0.5 percent, to 20,611.9. The Nasdaq composite increased 36.9 points, about 0.6 percent, to 5,919.4.

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THE BOND MARKET: The higher bond yields sent high-dividend stocks broadly lower for the second day running. At the close, the yield on the 10-year Treasury note was up 2.5 percent Wednesday, up from 2.47 percent late Tuesday.

OIL PRICES: As markets closed, benchmark U.S. crude was down 13 cents at $53.07 per barrel in electronic trading on the New York Mercantile Exchange. In London on the Intercontinental Exchange Europe, Brent crude, used to price international oils, was down 26 cents at $55.71 a barrel.

ENCOURAGING ECONOMIC GAINS: Wednesday’s economic reports give the Federal Reserve more encouragement to raise interest rates, and economists said the possibility is increasing that it may happen at the central bank’s next meeting in March. Retailers had stronger sales in January than economists expected, and inflation at the consumer level was the highest in years. Consumer prices rose 2.5 percent in January from a year earlier, the highest rate since March 2012.

Fed Chair Janet Yellen said in testimony before a Senate committee on Tuesday that the strengthening job market and a modest move higher in inflation should warrant continued, gradual increases in interest rates. The central bank raised rates in December for just the second time in a decade, after keeping rates at nearly zero to help lift the economy out of the Great Recession. Yellen speaks before a House committee Wednesday.

DAMPENED DIVIDEND DEMAND: When bonds are paying more in interest, it can mean less demand from income investors for stocks that pay big dividends. Utility stocks, which are some of the biggest dividend payers, fell 1 percent, the largest loss among the 11 sectors that make up the S&P 500. Real estate investment trusts, which are also go-to buys for dividend seekers, were weak as well.