Stocks rose again on Tuesday as investors looked to build on Monday’s rally amid a busy week of corporate earnings.
The Dow Jones Industrial Average gained 215 points, or about 0.7%. The S&P 500 and Nasdaq Composite gained 0.6% and 0.2%, respectively.
The averages were higher in early trading, with the Dow gaining more than 600 points, but came off their highs as U.S. Treasury yields moved up. The Nasdaq briefly turned negative for the session before the market bounced off its lows.
Strong earnings results on Tuesday helped extend a rally that began on Monday. Goldman Sachs rose 3% after strong trading results helped the investment bank beat expectations for earnings and revenue.
That report continued a strong stretch of bank earnings, including beats from Bank of America and Bank of New York Mellon on Monday. Lockheed Martin also rose more than 5% after its earnings per share topped estimates.
Elsewhere, Salesforce rose almost 4% after activist Starboard Value LP revealed a stake in the software giant, boosting the Dow. Shares of Colgate-Palmolive gained nearly 2% after Dan Loeb’s Third Point built a stake in the company, CNBC’s David Faber reported.
Wall Street is coming off a strong start to the week, as the Nasdaq surged 3.43% on Monday for its best day since July 27.
Fears of a recession and overly aggressive central banks have helped push the U.S. markets to their lows of the year in recent weeks, but the solid start to earnings season may signal that the economy is currently in better shape than feared.
“3Q and 4Q earnings should confirm fundamentals remain anchored in resilient labor market and Covid reopening. Equity valuation will likely remain tied to global central bank rhetoric and rates, which is turning incrementally less negative. As such, we see equities primed for upside into year-end on resilient 2H22 earnings, low equity positioning, very negative sentiment and given more reasonable valuation,” Dubravko Lakos-Bujas, JPMorgan’s head of global macro research, said in a note to clients.
“Next year, however, we expect a more challenging earnings backdrop relative to current expectations,” he added.
After the bell, Netflix and United Airlines will report their latest results.