Ms Yellen stayed silent on monetary policy while speaking at the annual meeting of central bankers in Jackson Hole, Wyoming.
Interest-rate sensitive sectors such as telecommunications, up 0.8 per cent, and utilities, up 0.3 per cent, rose after her speech.
Her address focused on financial stability while giving no hint on monetary policy, leaving the prospect of more interest rate hikes up in the air.
Ms Yellen said the reforms put in place after the 2007-2009 financial crisis have strengthened the financial system, without impeding economic growth.
But she did not comment on the path of interest rate hikes for the central bank, which sent United States Treasury yields lower.
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JJ Kinahan, chief market strategist at TD Ameritrade in Chicago, said: “The worry still remains about the 10-year [benchmark Treasury note] rate, still below 2.2 per cent.
“That is kind of a concern and it doesn’t surprise me you are starting to see stocks hang in there only because everybody is searching for yield.”
Meanwhile, a speech by European Central Bank chief Mario Draghi gave little guidance on tapering the bank’s bond holdings.
Instead, he heralded globalisation over protectionism and insisted the global economic recovery was “firming up”.
Jeffrey Cleveland, chief economist at Payden & Rygel in Los Angeles, said: “If anything, both with Draghi and Yellen, the big fear from investors was a more hawkish stance on monetary policy.
“Those fears were overblown. You didn’t have that hawkish surprise.”
The euro rose to its highest in more than two years after Draghi’s comments while the dollar index weakened 0.75 per cent.
US stocks got off to a strong start after the White House said it would turn its attention to the long-awaited tax reform agenda next week.
Treasury Secretary Steven Mnuchin said the US debt ceiling, a hurdle to be crossed before any tax reform can take place, will be raised in September.