US stocks rise, strong earnings lift retailers

Wall Street stocks closed sharply higher on Tuesday as solid company earnings helped lift several retailers ahead of the US Thanksgiving holiday

The S&P 500 rose 1.4%, more than paring last week’s losses. The Dow Jones Industrial Average rose 1.2% and the Nasdaq gained 1.4%.

All company sectors in the benchmark S&P 500 rose, with technology stocks driving much of the rally. Chipmaker Nvidia rose 4.7%.

Financial and healthcare stocks also helped lift the market. Charles Schwab rose 1.6% and Pfizer rose 1.9%.

Energy stocks were the biggest gainers as the price of US crude rose 1.5%. Chevron rose 2.6%.

“Yesterday’s slow energy sell-off was overblown,” said Jay Hatfield, managing director of Infrastructure Capital Advisors. “So you’re getting the energy back and that really leads the market.”

Long-term Treasury yields fell. The yield on the 10-year Treasury, which influences mortgage rates, fell to 3.76% from 3.84% on Monday afternoon.

“When rates go down, it’s great for all stocks,” Hatfield said.

The S&P 500 rose 53.64 points to 4,003.58. The Dow gained 397.82 points to 34,098.10. The Nasdaq, very technological, rose 149.90 points to 11,174.41.

Shares of smaller companies also rose. The Russell 2000 rose 21.20 points, or 1.2%, to 1,860.44.

Investors have very little news to review this week, but several retailers and tech companies are closing out the latest round of corporate earnings with their financial results. Best Buy rose 12.8% after the electronics retailer did better than analysts expected and said a sales decline for the year won’t be as bad as previously projected.

Dell Technologies rose 6.8% after the PC maker reported strong third-quarter profit and revenue. Zoom Video fell 3.9% after giving investors a weak profit and revenue forecast.

A number of retailers posted particularly strong earnings following strong financial results. Abercrombie & Fitch rose 21.4% and American Eagle rose 18.2%.

Almost every company in the S&P 500 has reported its latest financial results, according to FactSet, and the results have been mixed. Companies in the index reported overall earnings growth of about 2%, but also issued several warnings about weaker consumer demand and reduced sales as inflation continues to squeeze consumers.

Inflation and the Federal Reserve’s struggle to tame it remains Wall Street’s top concern. The central bank will release the minutes of its latest policy meeting on Wednesday, which could give investors more insight into its decision-making process.

Wall Street has been hoping the central bank could ease its aggressive rate hikes. Its benchmark rate is currently between 3.75% and 4%, down from near zero in March.

The Fed has warned that it may ultimately have to raise rates to an unexpected level to cool the highest inflation in decades. This strategy increases the risk that it could go too far to slow economic growth and trigger a recession.

Concerns about a recession continue to hang over the global economy and markets.

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