The S&P 500 closed largely unchanged at 2,861.82 as energy and tech outperformed. Energy stocks were boosted by a 3 percent rally in oil. The Nasdaq Composite, meanwhile, rose 0.4 percent to close at 7.889.10 as Netflix and Amazon gained 1.9 percent and 1.1 percent, respectively. The Dow Jones Industrial Average slipped 89 points, however, closing at 25,733.60.
Wednesday's moves took place as the current bull market was set to become the longest on record. Target shares jumped on strong earnings, helping stocks offset some of the losses. Home-improvement retailer Lowe's also reported better-than-expected earnings, sending its stock up more than 6 percent.
The current bull market turned 3,453 days old on Wednesday. In that time, the S&P 500 has skyrocketed more than 300 percent in that time period. On Tuesday, it tied the one that ran from October 1990 to March 2000.
"Sentiment in the financial markets was so low after the crisis that it appeared we were going to get a bounce," said Jeff Zipper, managing director of investments at U.S. Bank Private Wealth Management. "But I don't think we were expecting one of this magnitude."
Target reported better-than-expected quarterly earnings on the back of its best same-store sales growth in 13 years. The report sent Target shares up by more than 3 percent.
Meanwhile, former Trump campaign manager Paul Manafort was found guilty on eight counts in a separate case. Five of those counts pertained to tax fraud, two to bank fraud and one to failing to file foreign bank account reports.
Stock futures fell overnight after the news came out but quickly jumped off their lows.
"I'm not sure investors are going to care," said Bruce McCain, chief investment strategist at Key Private Bank. "A lot of the conversation this morning is surrounding the fact that what they need to impeach is not there."
"There is going to be a controversy, some uncertainty ... but a present it is a nonevent" compared to the other issues the market is dealing with.
Also helping to boost sentiment was a Politico report that said a "handshake" deal between the U.S. and Mexico on NAFTA could be announced on Thursday. The report, which cites three sources close to the talks, said that time has been cleared on the White House schedule for the announcement.
The report comes as a nine-member delegation from Beijing is set to start talks with U.S. officials in Washington today, with the hope of finding ways to relieve friction between the two nations. The meeting comes as fresh tariffs from the U.S. on $16 billion of Chinese goods are due to come into effect this week, with Beijing having imposed the same amount in retaliatory levies on the States.
"The political disruptions being caused by Trump are creating a lot of noise in the market," said Janet Johnston, a portfolio manager at TrimTabs Asset Management. "But the underlying fundamentals remain strong."
The Federal Reserve released the minutes from its meeting earlier this month. The minutes showed central bank officials are concerned that the ongoing trade war is the biggest threat to an otherwise "strong" economy.
"It's a tricky situation for the Fed," said Anwiti Bahuguna, senior portfolio manager at Columbia Threadneedle Investments. "The trade war is a known issue for the market" but "the Fed knows it can only react to it; they can't do much about it because it's not their policy realm."