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US STOCKS-Wall St rebounds after earlier losses on Yellen hopes

* Defensive sectors rebound, including utilities, telecom

* Nasdaq drops as the year's winning tech stocks falter

* Wall St looks past Washington impasse to more gains-poll

* Dow up 0.3 pct, S&P 500 up 0.2 pct, Nasdaq down 0.4 pct

By Julia Edwards

NEW YORK, Oct 9 (Reuters) - U.S. stocks climbed Wednesday to recover some of the day's earlier losses, and the year's high-performing technology stocks fell, as investors anticipated the nomination of Janet Yellen as U.S. central bank chairman and as a political standoff continued in Washington.

The stalemate in Washington and expectations of Yellen's nomination as Federal Reserve chief made for a volatile market on Wednesday, leading investors to lock in profit on the year's major gainers, many of them technology shares. Facebook was the biggest drag on the Nasdaq 100, down 2.6 percent to $45.92. The Nasdaq 100 index has had its biggest three-day drop this week since June 2012.

The broader market was in somewhat better shape, with defensive sectors such as telecommunications and utilities rising on the day.

"With the uncertainty over the government shutdown and the shaving away of the GDP each day, unfortunately, some investors will start selling these things that were good for the year rather than pulling off the laggards. And tech has been performing very highly," said Michael Matousek, head trader at U.S. Global Investors in San Antonio, Texas.

The CBOE Volatility Index, a measure of investor anxiety, continued to rise, hitting 21.34, before retreating to 19.62. A level above 20 is generally associated with increasing concern about the near-term direction of the market. Trading in VIX options contracts reached a one-day record on Tuesday.

President Barack Obama and Congressional Republicans are locked in a battle over funding the government and raising the federal borrowing limit, expected to be surpassed by Oct. 17. The crisis in Washington threatens to damage the credit standing of the United States and to derail the nation's fragile economic recovery.

Investors were optimistic about the expected nomination of Yellen as Fed chairman, to be announced Wednesday afternoon. They expect her to tread carefully in winding down the Fed's economic stimulus and to provide continuity with the policies of Fed Chairman Ben Bernanke, whose second term is due to expire on Jan. 31.

"She is generally seen as more dovish than Bernanke," said Matousek. "When you clear up the uncertainty of the government shutdown and see that she will probably not taper at least until January of February of 2014, you'll probably see a bid for some of these tech companies again."

A poll by Reuters showed Wall Street strategists expect the market to rebound toward the end of the year.

The Dow Jones industrial average was up 47.26 points, or 0.32 percent, at 14,823.79. The Standard & Poor's 500 Index was up 3.01 points, or 0.18 percent, at 1,658.46. The Nasdaq Composite Index was down 14.26 points, or 0.39 percent, at 3,680.57.

The S&P 500 dropped 1.2 percent on Tuesday, its worst decline since Aug. 27, sending the benchmark index to its lowest level since Sept. 6 as traders cashed in gains in some of the year's highest performing tech stocks.

Men's Wearhouse jumped 29.1 percent to $45.49 after it rejected smaller rival Jos. A. Bank Clothiers Inc's $2.3 billion takeover offer, saying it significantly undervalued the company and could raise antitrust issues. Jos. A. Bank shares rose 7.5 percent to $44.79.

Yum! Brands Inc fell 8.0 percent to $65.58 as both the worst performer and biggest drag on the S&P 500 after the KFC parent warned it will take longer than expected for restaurant sales to rebound in China, which accounts for more than half the company's overall operating profit.