New York ? Treasurys slumped Wednesday after the Federal Reserve sided with stock investors and said the economy is showing signs of stabilizing.

The central bank’s assessment dampened demand for the safety of government debt, pushing bond yields sharply higher.

The stock market has been surging since early March on hopes that the economy is patching its wounds.

The Dow Jones industrial average is up 25 percent since finishing at a 12-year low on March 9.

That unnerved Treasury investors and gave the stock market another shot of confidence that the latest rally is on solid footing. The Dow jumped 169 points on the day, while the Standard & Poor’s 500 index ended at a three-month high.