Stock market today: Wall Street rebounds and adds to its hot start to the week

NEW YORK (AP) U.S. stocks are rallying Tuesday, adding to their hot start to the week.

The S&P 500 rose 1.1% in afternoon trading, further climbing out of the hole created by a six-day losing streak. The Dow Jones Industrial Average was up 240 points, or 0.6%, as of 12:24 p.m. Eastern Time, and the Nasdaq Composite Index was up 1.5%.

A weaker-than-expected U.S. trade activity report helped support the market. Financial markets are in a delicate phase where there is hope that the economy will remain strong enough to avoid a recession, but not so strong as to maintain upward pressure on inflation.

S&P Global's preliminary report released Tuesday appears to have hit that sweet spot. Treasury yields fell in the bond market and stocks added to their gains immediately after its release.

A flood of earnings reports also dictated much of the trading. Danaher was one of the most powerful forces lifting the S&P 500 after reporting first-quarter profit that was higher than analysts expected. It rose 7.2% after citing strength in its bioprocessing and molecular diagnostics businesses.

Kimberly-Clark gained 5.7% after the maker of Huggies, Kleenex and Kotex reported better-than-expected first-quarter profit and raised its profit forecast for the full year. General Motors rose 4.7% after beating forecasts on sales of more profitable pickup trucks and other vehicles. GE Aerospace climbed 7.8% after announcing a profit for the last quarter that was higher than expected by analysts.

They helped eclipse a 7.4% decline for Nucor after the steelmaker missed its earnings and revenue forecasts.

MSCI, whose investment indexes guide much of the sector, fell 13.4% after reporting weaker-than-expected revenue growth.

Sherwin Williams fell 2% after also missing expectations, partly due to weak paint sales for new homes amid industry challenges linked to high mortgage rates.

JetBlue Airways lost 16% despite better-than-expected results for the latest quarter. Its forecast for future revenues came in lower than what some analysts had expected. Other airlines also weakened, including a 1.4% decline for American Airlines.

The main market event could come after the day's trading ends. That's when Tesla will become the first of the Magnificent Seven stocks that accounted for most of last year's gains for the S&P 500 to report first-quarter results. Expectations are high after a small handful of stocks skyrocketed to big gains in 2023, and they will need to at least match them to justify their prices.

While skeptics continue to call the stock market too expensive, the criticism would lessen if companies earned higher profits or interest rates fell. The latter seems less likely.

Top Federal Reserve officials warned last week that they may need to keep interest rates high for some time to ensure inflation moves toward their 2% target. This was a big disappointment for financial markets, dashing hopes raised after the Fed earlier signaled that three interest rate cuts could take place this year.

A rate cut appeared to be on the horizon after inflation slowed sharply last year. But a series of reports this year showing that inflation remained higher than expected has raised concerns that progress may be stalled.

That's why Tuesday's report suggesting slowing growth in overall business activity across the country was so well-received.

The yield on the 10-year Treasury note fell to 4.58% to ease pressure on stocks in general, particularly those with high growth and those that pay high dividends. The 10-year yield was at 4.64% just before the report was published and at 4.61% Monday evening.

The two-year Treasury yield, which moves more in line with expectations about Fed action, saw a similar decline. It fell to 4.93% from 4.97% Monday evening.

On foreign stock markets, indices rose in much of Europe. They were mixed earlier in Asia. Shares jumped 1.9% in Hong Kong but fell 0.7% in Shanghai.

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AP Business writers Matt Ott and Zimo Zhong contributed.