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| Stocks Rise as Corporate Earnings Again Defy Expectations | Stocks Rise as Corporate Earnings Again Defy Expectations |
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| Stock markets rallied for a second day on Tuesday, recording another jump as bond yields edged lower after a batch of better-than-expected earnings reports from big companies. | Stock markets rallied for a second day on Tuesday, recording another jump as bond yields edged lower after a batch of better-than-expected earnings reports from big companies. |
| The S&P 500 rose roughly 1 percent in midday trading, extending a 2.7 percent gain on Monday and pushing the index further into positive territory for the month. | The S&P 500 rose roughly 1 percent in midday trading, extending a 2.7 percent gain on Monday and pushing the index further into positive territory for the month. |
| Investors are watching companies that are reporting earnings this quarter to get a sense of how they are faring as worries grow about persistent inflation and a potential recession. Wild swings in markets in recent weeks have come as the Federal Reserve’s efforts to tame inflation have proved difficult, which has bolstered the possibility of another large increase in interest rates when the central bank’s policymakers next meet, in early November. | Investors are watching companies that are reporting earnings this quarter to get a sense of how they are faring as worries grow about persistent inflation and a potential recession. Wild swings in markets in recent weeks have come as the Federal Reserve’s efforts to tame inflation have proved difficult, which has bolstered the possibility of another large increase in interest rates when the central bank’s policymakers next meet, in early November. |
| Goldman Sachs, Johnson & Johnson and Lockheed Martin reported quarterly profits that beat analysts’ expectations on Tuesday, a day after Bank of America, Charles Schwab and other bellwether firms reported surprisingly robust results. In part, that was because forecasts had been lowered, given the economic jitters: Goldman’s third-quarter profit fell more than 40 percent from a year earlier. | Goldman Sachs, Johnson & Johnson and Lockheed Martin reported quarterly profits that beat analysts’ expectations on Tuesday, a day after Bank of America, Charles Schwab and other bellwether firms reported surprisingly robust results. In part, that was because forecasts had been lowered, given the economic jitters: Goldman’s third-quarter profit fell more than 40 percent from a year earlier. |
| Some analysts have cautioned against reading into the market gains, describing them as “bear market rallies” that will eventually give way to more selling. Even after big gains in three of the past four trading sessions, the S&P 500 is down more than 20 percent this year. | Some analysts have cautioned against reading into the market gains, describing them as “bear market rallies” that will eventually give way to more selling. Even after big gains in three of the past four trading sessions, the S&P 500 is down more than 20 percent this year. |
| “We do not believe the conditions are in place for a sustained rally,” Mark Haefele, the chief investment officer at UBS Global Wealth Management, said in an email. “Economic growth will likely continue to slow into the start of the new year.” | “We do not believe the conditions are in place for a sustained rally,” Mark Haefele, the chief investment officer at UBS Global Wealth Management, said in an email. “Economic growth will likely continue to slow into the start of the new year.” |
| A survey of fund managers by Bank of America said the market may be poised for another bear market rally if U.S. Treasury yields, a benchmark for borrowing costs, stayed under 4 percent. The U.S. 10-year Treasury note fell just below that yield on Tuesday and the two-year fell to 4.4 percent. Yields move inversely to prices. | |
| Elsewhere, London’s FTSE 100 closed 0.2 percent higher, adding to Monday’s gains after Jeremy Hunt, the new chancellor of the Exchequer, upended Prime Minister Liz Truss’s tax cut plan. In Europe, the Stoxx 600 rose 0.3 percent, Hong Kong’s Hang Seng closed with gains of 1.8 percent and Tokyo’s Nikkei 225 was up 1.4 percent. | |
| The price of West Texas Intermediate crude oil, the U.S. benchmark, fell 3.5 percent to about $82 a barrel on Tuesday. The price of Brent crude, the global benchmark, fell 2.7 percent, to nearly $89 a barrel. | The price of West Texas Intermediate crude oil, the U.S. benchmark, fell 3.5 percent to about $82 a barrel on Tuesday. The price of Brent crude, the global benchmark, fell 2.7 percent, to nearly $89 a barrel. |
| In currency markets, the pound fell 0.4 percent versus the dollar, to $1.13. The yen, which slid to its weakest level since July 1990 on Monday, gained 0.1 percent against the dollar. | In currency markets, the pound fell 0.4 percent versus the dollar, to $1.13. The yen, which slid to its weakest level since July 1990 on Monday, gained 0.1 percent against the dollar. |