© Reuters. FILE PHOTO: A man walks past in front of an electric monitor displaying the Japanese Nikkei share average in Tokyo, Japan October 14, 2022 REUTERS/Issei KatoBy Stephen Culp
NEW YORK (Reuters) – Wall Street stocks closed higher and Treasury yields dipped on Tuesday as upbeat earnings and better-than-expected factory data stoked a risk-on rally.
Building on Monday’s broad gains, the led the major U.S. stock indexes higher to end the session up nearly 1% or more, with sectors across the board advancing.
Meanwhile benchmark Treasury yields were last lower, having oscillated throughout the day.
“The market was a bit oversold leading into Monday, and people were worried of what was going to happen over the weekend. People walked into the week feeling a little better,” said Robert Pavlik, senior portfolio manager at Dakota Wealth in Fairfield, Conn. “You’re getting a combination of short covering and fear of missing out.”
Better-than-expected quarterly results from Goldman Sachs Group Inc (NYSE:), Johnson & Johnson (NYSE:) and Lockheed Martin (NYSE:) set the tone, with robust industrial output data providing signs of economic strength even as central banks tighten monetary policy to tackle inflation.
The belief that “a recession is coming and the Fed is going to be raising interest rates, with the hope that maybe a pause is going to be coming something next year,” is now baked into the market, Pavlik said. “Without all that weight, the market can rise higher after being sold off.”
The rose 337.98 points, or 1.12%, to 30,523.8, the S&P 500 gained 42.04 points, or 1.14%, to 3,719.99 and the added 96.60 points, or 0.9%, to 10,772.40.
Monday’s policy reversal from British finance minister Jeremy Hunt’s continued to buoy investor sentiment.
European shares extended their policy U-turn rally – with an assist from the tech sector – to close modestly higher on the day.
The pan-European index rose 0.34% and MSCI’s gauge of stocks across the globe gained 1.13%.
Emerging market stocks rose 1.50%. MSCI’s broadest index of Asia-Pacific shares outside Japan closed 1.55% higher, while rose 1.42%.
Treasury yields wavered throughout the session, but had edged lower by the closing bell.
The benchmark 10-year note yield was last at 3.9922%, from 4.015% late on Monday.
The 30-year bond last rose 1/32 in price to yield 4.0142%, from 4.015% late on Monday.
The British pound dipped after surging nearly 2% on Monday, which propped up the greenback against a basket of world currencies, but the dollar was last essentially flat, its gains held in check by risk-on investor sentiment.
The rose 0.02%, with the euro up 0.17% to $0.9855.
The Japanese yen weakened 0.12% versus the greenback at 149.22 per dollar, while sterling was last trading at $1.1327, down 0.23% on the day.
Crude prices dropped on fears of higher U.S. stockpiles and signs of waning global demand.
slid 3.09% to settle at $82.82 per barrel, while settled at $90.03 per barrel, down 1.74% on the day.
The unchanged dollar helped support gold’s nominal gain.
added 0.1% to $1,650.94 an ounce.
