NEW YORK: Wall Street’s main indexes advanced on Tuesday after reports of fresh efforts to ease the Middle East conflict boosted sentiment, while traders also assessed a spate of corporate earnings.
Delegations from the US and Iran could resume talks in Pakistan to end the war this week, sources told Reuters. US President Donald Trump also said Iran wanted to make a deal.
The market has been sensitive to developments in the region, with even tentative signs of an off-ramp sufficient to encourage investors eager for positive news.
“The shift in the US-Iran conflict from missiles to words leaves markets hoping for a beginning to the end of the war,” said Bob Savage, head of markets macro strategy at BNY.
At 11:26 a.m. ET, the Dow Jones Industrial Average rose 290.36 points, or 0.60 percent, to 48,508.61. The S&P 500 gained 60.15 points, or 0.88 percent, to 6,946.39, and the Nasdaq Composite jumped 326.91 points, or 1.41 percent, to 23,510.64.
The S&P 500 was on track to recoup all its losses since the start of the war, while the Nasdaq 100 was set for a 10-day winning streak, its longest since 2021.
Still, any hint of a re-escalation in hostilities could quickly derail the rally, especially as concerns about the economic impact of the war persist.
The International Monetary Fund cut its global growth outlook on Tuesday.
Commentary from several Federal Reserve policymakers will also be closely watched through the day for insight into how the central bank is assessing the impact of the US-Iran war.
In addition to geopolitics, investors are taking cues from a busy slate of quarterly earnings to guide their positioning.
“The earnings season will help investors shift their focus from the macro to the micro,” said Art Hogan, chief ?market strategist at B Riley Wealth.
BlackRock gained 4.2 percent after the asset manager reported a rise in first-quarter profit, helped by strong inflows into its exchange-traded funds and a sharp increase in performance fees.
Citigroup rose 1.5 percent and hit its highest in nearly two decades after beating first-quarter profit estimates, while Johnson & Johnson added 1.4 percent after reporting earnings.
JPMorgan inched 0.6 percent lower following its first-quarter results, while Wells Fargo declined 4.8 percent after interest income fell short of market expectations.
The S&P’s financial sector edged 0.3 percent higher. Software stocks rose 1.4 percent, logging their biggest two-day gains since May last year.
Among other stock movers, United Airlines and American Airlines rose 4 percent and 8.9 percent, respectively.
United Airlines CEO Scott Kirby pitched a potential merger with American Airlines to Trump in late February, two sources said, raising the prospect of a deal that could reshape the industry.
Shares of Globalstar jumped 10.1 percent after Amazon.com agreed to buy the satellite company.
Separately, data on Tuesday showed that US producer prices increased less than expected in March as the cost of services was unchanged.
Advancing issues outnumbered decliners by a 2.61-to-1 ratio on the NYSE and by a 2.4-to-1 ratio on the Nasdaq.
The S&P 500 posted 18 new 52-week highs and one new low, while the Nasdaq Composite recorded 109 new highs and 29 new lows.
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