NEW YORK – Stocks rebounded from an early slide Tuesday as stronger consumer confidence boosted hopes for the economy.

The market advanced after the Conference Board said its index of consumer confidence rose to 55.9 in January from 53.6 in December. It was the third straight increase and the highest level in more than a year.

The Dow Jones industrial average rose 55 points in midday trading, boosted by a big gain in Travelers Cos. after the insurer said an absence of catastrophe costs and a recovery in its investment portfolios lifted profits 60 percent for the final three months of 2009.

Concerns about the global economy had been holding the market lower. China moved ahead with a plan to curb bank lending to keep that country’s economy from overheating. Investors in the U.S. and elsewhere are concerned a slowdown in China could destabilize a worldwide recovery.

Meanwhile, Federal Reserve policymakers were beginning a two-day meeting on interest rate policy. The central bank is expected to keep rates at record lows, though investors will be looking at the Fed’s assessment of the economy in a statement that will follow the meeting on Wednesday.

Stocks broke a three-day slide Monday as Fed Chairman Ben Bernanke’s prospects for confirmation to another four-year term brightened. His term ends Sunday. Doubts about his ability to get confirmed in the Senate last week helped destabilize the stock market.

Michael Binger, portfolio manager at Thrivent Investment Management in Minneapolis, said a 5.1 percent drop in the Standard & Poor’s 500 index in the final three days of last week is making it easier for stocks to resume their 10-month advance.

“When stocks get a little extended it kind of paralyzes the bulls a bit,” Binger said. “Right now, stocks are not that extended.”

In midday trading, the Dow rose 54.87, or 0.5 percent, to 10,251.73. The Standard & Poor’s 500 index rose 4.18, or 0.4 percent, to 1,100.96, while the Nasdaq composite rose 9.79, or 0.4 percent, to 2,220.59.

Falling stocks narrowly outpaced those that rose on the New York Stock Exchange, where volume came to 409.3 million shares, compared with 509 million shares traded at the same point Monday.

The dollar rose against other major currencies, while gold advanced.

Crude oil fell 34 cents to $74.92 per barrel on the New York Mercantile Exchange.

Bond prices were mixed. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.62 percent from 3.63 percent late Monday.

Dow component Travelers jumped $1.80, or 3.7 percent, to $50.69 after its report.

The Russell 2000 index of smaller companies rose 0.17, or less than 0.1 percent, to 618.28.

Asian markets fell as concerns rose about Japan’s economy hurting the country’s bond rating. Standard & Poor’s lowered its outlook on Japan’s credit rating to negative from stable, saying it would slash the country’s long-term rating if its economy remains weak and debt stays high.

Japan’s Nikkei stock average fell 1.8 percent, while Hong Kong’s Hang Seng fell 2.4 percent.

In afternoon trading, Britain’s FTSE 100 rose 0.3 percent, Germany’s DAX index advanced 0.8 percent and France’s CAC-40 rose 0.7 percent.

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