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Stock market today: Wall Street rallies again to erase more April losses

Stock market today: Wall Street rallies again to erase more April losses


NEW YORK (AP) U.S. stocks rallied for a second straight day Tuesday to soften the blow of a difficult April.

The S&P 500 rose 1.2% and moved further out of the hole created by a six-day losing streak. The Dow Jones Industrial Average rose 263 points, or 0.7%, and the Nasdaq composite jumped 1.6%.

A weaker than expected report on business activity in the United States helped support the market, which remains in a delicate phase. The hope on Wall Street is that the economy avoids a serious recession, but not that it remains so hot that it maintains 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, highlighted by a large number of companies beating analysts' expectations.

GE Aerospace rose 8.3% after raising its full-year profit forecast, in addition to beating expectations for first-quarter earnings.

Kimberly-Clark gained 5.5% after the maker of Huggies, Kleenex and Kotex also raised its full-year profit forecast. General Motors rose 4.4% after citing more profitable sales of pickup trucks and other vehicles. Danaher rose 7.2% after highlighting the strength of its bioprocessing and molecular diagnostics businesses.

They helped eclipse an 8.9% drop for Nucor after the steelmaker missed its profit and revenue forecasts.

MSCI, whose investment indexes guide much of the sector, fell 13.4% after reporting weaker-than-expected revenue growth. Invesco fell 6.4% after missing profit and revenue expectations.

JetBlue Airways lost 18.8% despite better-than-expected results for the latest quarter. Its forecast for future revenue came in lower than some analysts expected and the group said competition in Latin America could weigh on its results.

Overall, the S&P 500 rose 59.95 points to 5,070.55. The Dow Jones gained 263.71 to 38,503.69 and the Nasdaq composite jumped 245.33 to 15,696.64.

The markets main event may have arrived after the end of the day's trading. Tesla released its results for the first three months of the year, becoming the first to do so among the Magnificent Seven who accounted for most of last year's gains for the S&P 500.

Expectations are high for each of the Mag 7s after hitting big gains in 2023, and they will need to at least match them to justify their prices.

Several of these were behind the broader market's recent decline, which saw the S&P 500 fall as much as 5.5% in April. This underlines the importance of earnings over the next two weeks, which will be dominated by Mag7, and the risk that disappointing results will accelerate the sell-off, according to Barclays strategists led by Stefano Pascale and Anshul Gupta.

While skeptics continue to call the stock market too expensive, the criticism would only subside if companies earn higher profits or interest rates fall. 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. This could leave the door open for the Fed to cut interest rates by one or two times as many traders are currently predicting.

The yield on the 10-year Treasury note fell to 4.59% 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 4.92% 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.


AP Business writers Matt Ott and Zimo Zhong contributed.




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