U.S. stocks rallied on Tuesday after companies reported better-than-expected profits, helping to steady other U.S. investments that had fallen the day before due to concerns about President Donald Trump’s trade war and his attacks on the head of the Federal Reserve. The S&P 500 was up 2%, the Dow Jones Industrial Average was up 2%, and the Nasdaq composite was up 2.2%. The value of the U.S. dollar stabilized, and Treasury yields held steadier, alleviating worries that Trump’s policies were impacting market stability. Many Wall Street strategists predict continued volatility in the markets as hopes rise and fall over potential trade deals with other countries.
While the International Monetary Fund slashed its forecast for global economic growth to 2.8%, down from 3.3%, some signs of progress were seen as Vice President JD Vance made headway with India’s prime minister on trade talks. Gold continued to rise as a safer investment option during times of market uncertainty. Better-than-expected profit reports from companies like Equifax, 3M, and PulteGroup contributed to the positive performance in U.S. stocks. Equifax saw an 11.8% jump in its stock after reporting strong profits and announcing increased dividends and stock buybacks. 3M and PulteGroup also reported stronger profits than expected, benefiting from lower mortgage rates due to drops in Treasury yields.
Not all companies reported positive earnings, as Tesla faced challenges, including a 13% drop in first-quarter car sales and backlash from consumers following Elon Musk’s involvement in the White House. Stocks demonstrated the impact of Trump’s tariffs on different industries, with some companies benefiting while others faced losses. First Solar saw a 13.5% jump in its stock after new solar tariffs were imposed, while defense contractors like RTX faced potential profit hits due to tariffs on imports. Kimberly-Clark reported better-than-expected profits but lowered its forecast due to increased costs in the global supply chain.
In the bond market, the yield on the 10-year Treasury eased slightly, and stock markets in Europe and Asia saw mixed and modest moves. Investors are monitoring ongoing trade negotiations and the impact of Trump’s policies on the global economy. The markets are expected to continue experiencing volatility as trade tensions persist and economic forecasts fluctuate. Overall, the performances of U.S. stocks and other investments rely heavily on developments in trade relations, economic growth, and government policies, with investors navigating uncertainty and adjusting their strategies accordingly. The potential for continued market fluctuations and the outcomes of trade negotiations will shape the future trajectory of investments in the U.S. and globally.
