US stocks rose on Tuesday, driven by optimism ahead of key inflation reports and gains in JPMorgan and other financial shares before earnings later in the week. Investors are looking for indications on whether price pressures are reducing and if the Federal Reserve is nearing the end of its interest rate hiking cycle. The consumer price data is expected on Wednesday, while the producer prices report is due on Thursday. Several Fed officials have stated that the central bank will need to raise rates further to control inflation but that the end of its tightening cycle is approaching.
JPMorgan Chase & Co shares gained 1.6% after Jefferies upgraded the stock to a “buy” ahead of the bank’s quarterly results due on Friday. Reports from JPMorgan and other major banks are expected to unofficially mark the start of the second-quarter reporting period. The S&P banking index rose by 1.5%. Energy shares also saw a jump along with significantly higher oil prices.
“It’s nice to see the market broadening out here ahead of earnings,” said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder in New York. “We’ve got a lot of data that’s going to be coming in here … and expectations for the third quarter are also a concern in terms of any guidance companies might be giving on earnings calls.”
As of now, the S&P 500 has risen by 15.6% this year, with technology seeing an increase of 40% during this period. The Dow Jones Industrial Average has gained 317.02 points, or 0.93%, to reach 34,261.42, the S&P 500 has increased by 29.73 points, or 0.67%, to reach 4,439.26 and the Nasdaq Composite has added 75.22 points, or 0.55%, to reach 13,760.70.
Wall Street banks are expected to report higher profits for the second quarter as rising interest payments offset a decrease in deal making. Among the top gainers on the S&P 500, shares of videogame maker Activision Blizzard rose by 10% after a US judge ruled that Microsoft can proceed with its planned acquisition of the “Call of Duty” game maker. Salesforce shares also saw a rise of 3.9% after the cloud services firm announced an increase in prices for some of its cloud and marketing tools for the first time in seven years. Additionally, Amazon.com shares edged up by 1.3% with its “Prime Day” 48-hour discount shopping event taking place this week.
Volume on US exchanges reached 9.97 billion shares, compared to the average of 11.1 billion over the last 20 trading days. Advancing issues outnumbered declining ones on the NYSE by a ratio of 3.65-to-1, while on Nasdaq, the ratio favored advancers at 1.82-to-1. The S&P 500 recorded 51 new 52-week highs and 1 new low, and the Nasdaq Composite recorded 91 new highs and 40 new lows.
