Stan Choe, AP Business Writer
NEW YORK (AP) – US stocks are rallying as companies report fatter profits than expected. The S&P 500 rose 2.6% on Tuesday, rebounding all declines since Monday. This was worried about President Donald Trump’s trade war and attacks on the head of the Federal Reserve. The Dow Jones industrial average rose 1,021 points or 2.7%. And Nasdaq composites rose 3%. Equifax, Pultegroup and 3M helped lead the way in following profit reports that exceeded expectations. The value of the US dollar has remained stable after sliding against the Euro and other competitors, but the Treasury yields remain stable in the bond market.
This is a news update. Previous stories about the AP are as follows:
NEW YORK (AP) – U.S. stocks rally on Tuesday after companies reported fatter profits than expected, with other US investments steady after a day has fallen violently in fears about President Donald Trump’s trade war and attacks on the head of the Federal Reserve.
The S&P 500 was on track to recover most of Monday’s decline by 2% in morning trading. The Dow Jones industrial average rose 765 points (2%) as of 10:45am Eastern time, with Nasdaq Composite rising 2.2%.
Additionally, the US dollar value has remained stable after sliding against the Euro and other competitors, but the Treasury yields remain stable. These sharp and unusual moves in markets have recently raised concerns that Trump’s policies are becoming more skeptical of investors, and US investments still deserve the world’s safest reputation.
The only prediction many Wall Street strategists will be happy to make is that financial markets will continue to swing up and down as Trump hopes to negotiate deals with other countries to lower his tariffs. Otherwise, many investors expect the economy to fall into a recession.
On Tuesday, the International Monetary Fund cut its forecast for global economic growth this year from 3.3% to 2.8%. However, Vice President JD Vance said he has made progress with India’s Prime Minister Narendra Modi in trade talks on Monday.
Signs of tension remain in financial markets. Gold, for example, continued to rise as it retained its reputation as a safer investment when fear controls the market.
Meanwhile, the suite of profit reports that exceeded expectations from large US companies has boosted US stocks.
Equifax rose 11.8% after reporting profits in the first three months of 2025 better than analysts expected. He also said he would send more cash to shareholders by increasing dividends and purchasing up to $3 billion in shares over the next four years.
3M rose 7.6% after the manufacturers of Scotch tape and command strips said they made more profits per dollar revenue than expected. The company also supported its forecast for earnings over the year, but said tariffs could reduce earnings per share by up to 40 cents per share.
Homebuilder Pultegroup rose 6.2% after delivering stronger profits at the start of 2025 than analysts expected.
It benefits from the sharp movements of the bond market. The recent unusual decline in Treasury yields has been converted to lower interest rates on potential client mortgages. However, a concurrent decline in stock prices can scare potential buyers.
CEO Ryan Marshall said buyers remain “engaged between a strong desire to own a home and the challenges of high selling and affordable monthly payments.”
Tesla rose 4.1% more than revenue reports expected to arrive after trading closed that day. This puts the annual loss below 42%.
Elon Musk electric vehicle companies have already reported a 13% decline in car sales in the first quarter from the previous year. It’s hurt by demanding a boycott of consumers amid vandalism, widespread protests and a backlash from Musk’s prominent role in the White House overseeing cost-cutting for US government agencies.
Stocks also showed how Trump’s tariffs will reshape the global economy and generate winners and losers.
Initial solar increased by 13.5% after the US Department of Commerce established stricter than expected solar tariffs in several Southeast Asian communities.
Defense contractors have suffered the sharpest losses on the market after RTX said US tariffs on Mexican and Canadian imports, along with other products, could hit this year’s profits by $855 million. RTX, which builds plane engines and military equipment, fell 8.4% despite reporting strong profits in the recent quarter.
Kimberly Clark lost 2.2% despite the manufacturers of Huggies and Kleenex similarly reporting profits above expectations.
CEO Mike Hsu lowered forecasts for the underlying measure of profit this year, saying, “The current environment means greater costs across the global supply chain,” compared to what was expected earlier this year.
In the bond market, the 10-year Treasury yield eased from 4.42% to 4.39% late Monday.
In overseas stock markets, indexes were mixed with modest movements in Europe and Asia.
AP business writers Eurikeyama and Matt Ott contributed.
Original issue: April 22, 2025 10:23am EDT
