Wall Street ends sharply higher, fueled by Apple

  • Walmart slips after cutting profit forecast
  • April retail sales rise in line with estimates
  • S&P 500 +2.02%, Nasdaq +2.76%, Dow Jones +1.34%

May 17 (Reuters) – Wall Street ended sharply higher on Tuesday, lifted by Apple, Tesla and other megacap growth stocks after strong retail sales in April eased worries about slowing economic growth.

Ten of the 11 major S&P sector indices advanced, with Financials (.SPSY), Materials (.SPLRCM), Consumer Discretionary (.SPLRCD) and Technology (.SPLRCT) all gaining more than 2%.

Investors were encouraged by data showing U.S. retail sales rose 0.9% in April as consumers bought motor vehicles amid improving supply and patronized restaurants . Read more

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Recently punished shares of Microsoft Corp (MSFT.O), Apple Inc (AAPL.O), Tesla Inc (TSLA.O) and Amazon (AMZN.O) gained between 2% and 5.1%, pushing the S&P higher 500 and the Nasdaq.

Tuesday’s broad rally followed weeks of selling in the US stock market that last week saw the S&P 500 plunge to its lowest level since March 2021.

“The larger pockets of stocks that investors tend to buy have basically been beaten. They are either in correction territory or bearish territory,” said Sylvia Jablonski, chief investment officer of Defiance ETF. “I think investors are looking at these downside buying opportunities, and I suspect today is a good day to do so.”

The S&P 500 Banks Index (.SPXBK) jumped 3.8%, with Citigroup (CN) climbing nearly 8% after Warren Buffett’s Berkshire Hathaway (BRKa.N) announced an investment of nearly $3 billion. dollars in the American lender.

Another set of economic data showed industrial production accelerated 1.1% last month, better than estimates of 0.5% and faster than a 0.9% advance in March. Read more

“This is consistent with continued economic growth in the second quarter and not an ongoing recession,” said Bill Adams, chief economist at Comerica Bank in Dallas.

The U.S. Federal Reserve “will continue to push” to tighten U.S. monetary policy until it is clear that inflation is down, Fed Chairman Jerome Powell said at an event on Tuesday . Read more

Traders are pricing in an 85% chance of a 50 basis point rate hike in June.

The S&P 500 climbed 2.02% to end the session at 4,088.85 points.

The Nasdaq gained 2.76% to 11,984.52 points, while the Dow Jones Industrial Average rose 1.34% to 32,654.59 points.

The most active trades in the S&P 500

Underscoring recent volatility on Wall Street, the S&P 500 has gained or lost 2% or more in a session about 39 times so far in 2022, compared to 24 times in 2021.

Walmart Inc (WMT.N) fell 11.4% after the retail giant slashed its full-year profit forecast, signaling a hit to margins. This marked the largest one-day percentage decline for Walmart shares since 1987. read more

Retailers Costco (COST.O), Target (TGT.N) and Dollar Tree (DLTR.O) fell between 0.8% and 3.2%.

United Airlines Holdings Inc (UAL.O) gained 7.9% after the carrier raised its revenue forecast for the current quarter, boosting shares of Delta Air (DAL.N), American Airlines (AAL.O) and Spirit Airlines (SAVE.N). Read more

A positive first-quarter earnings season was overshadowed by concerns over the conflict in Ukraine, soaring inflation, COVID-19 lockdowns in China and aggressive central bank policy tightening.

The S&P 500 is down about 14% so far in 2022, and the Nasdaq is down about 23%, hit by the fall in growth stocks.

U.S.-listed Chinese stocks jumped on hopes that China will ease its crackdown on the tech sector. Read more

Advancing issues outnumbered declining ones on the NYSE by a ratio of 2.92 to 1; on the Nasdaq, a ratio of 3.19 to 1 favored advancers.

The S&P 500 posted a new 52-week high and 30 new lows; the Nasdaq Composite recorded 24 new highs and 126 new lows.

Volume on U.S. exchanges was 12.0 billion shares, compared to an average of 13.3 billion over the past 20 trading days.

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Reporting by Amruta Khandekar and Devik Jain in Bengaluru and Noel Randewich in Oakland, California; Editing by Shounak Dasgupta and Lisa Shumaker

Our standards: The Thomson Reuters Trust Principles.

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