Bloomberg News
U.S. stocks climbed on Tuesday, with the Dow advancing over 200 points, as investors cheered results from Goldman Sachs Group Inc., Netflix Inc. and UnitedHealth Group Inc as well as positive economic data.
What are the main benchmarks doing?
The S&P 500 index added 21 points, or 0.8% to 2,699, with nine of its 11 main sectors trading higher. Consumer-discretionary and technology sectors were leading the gains, up more than 1%.
Meanwhile, the Nasdaq Composite Index gained 79 points, or 1.1%, to 7,235.
What’s driving markets
An upbeat attitude toward first-quarter earnings was expected to remain a driving factor for stocks Tuesday. S&P 500-listed companies are expected to see earnings growth of 17.3% for the period, the fastest rate since 2011.
Better-than-expected data on housing and industrial production as well as growth numbers from China provided benign economic background for Tuesday’s trading session.
China reported forecast-beating first-quarter economic growth of 6.8% on Tuesday. That growth was lifted by surprisingly strong exports, suggesting U.S. trade tensions have yet to make an impact.
Meanwhile, a lack of escalation in the trade tensions between China and the U.S. has also emboldened investors.
Which stocks are in focus?
Goldman Sachs gained 1.1% as the bank reported higher profit and revenue from a year ago.
UnitedHealth Group lifted guidance after reporting a nearly 31% profit rise in its latest quarter and shares rose 4.2%. Johnson & Johnson was up 0.3% after profit and revenue beat forecasts and the pharmaceutical and consumer products group lifted its sales outlook.
Reports from IBM Corp. and United Continental Holdings Inc. are due after the close.
What are strategists saying?
“Solid, better-than-expected earnings are the medicine that this market needed. And let’s not forget economic data: good housing starts today and positive retail sales on Monday are also helping drive the market higher,” said Karyn Cavanaugh, senior market strategist at Voya Financial.
Jeroen Blokland, portfolio manager on the Robeco Global Allocation team, chalked the move higher for U.S. stocks up to several factors: “No immediate further escalation on trade (although this is very shaky at the moment); earnings living up to expectations, which is pretty OK given the fact that expectations are demanding; China’s economy (for what it’s worth) is still doing OK, even though credit growth is going down,” he told MarketWatch.
What is on the economic docket?
Several Fed officials are lined up to speak in public on Tuesday. San Francisco Fed President John Williams, who has said he backs three or four gradual interest rate rises this year, is scheduled to give a speech in Madrid.
In another calendar highlight, Fed Vice Chair for Financial Supervision Randal Quarles will testify to the House Finance Committee on regulatory reform at 10 a.m.
Three nonvoting Fed members are on the docket: Philadelphia Fed President Patrick Harker is set to give a talk on the economics of higher education at St Joseph’s University in Philadelphia at 11 a.m., while Dallas Fed President Rob Kaplan is scheduled to appear at an International Economic Forum of the Americas event in Coral Gables, Fla. at noon. Chicago Fed President Charles Evans is due to speak on the economy and monetary policy to the Chicago Rotary Club at 1:10 p.m.
Housing starts ran at a seasonally adjusted annual pace of 1.32 million in March, up 2%, compared with February, the Commerce Department said Tuesday.
Separately, industrial production in March rose 0.5%, slightly above forecast of a 0.4% gain.