Wall Street bounces back as investors focus on earnings
Wall Street's main indexes have recovered some ground as investors focused on corporate earnings after US President Donald Trump's mounting criticism of Federal Reserve chair Jerome Powell led to a sharp sell-off in the previous session.
Investors sifted through a slew of quarterly earnings, with dozens more due through the week, for indications on how companies are navigating the uncertainty caused by tariffs and their expectations for a hit to future earnings.
"There's still a lot of uncertainty in the air with where tariffs will land ... but if we can look past that, the fundamentals in the markets still look very good," said Eric Sterner, chief investment officer for Apollon Wealth Management.
"Earnings are expected to grow 10 per cent for this first quarter, so corporate profits are still very healthy."
Shares of industrial conglomerate 3M Co, the biggest gainer on the blue-chip Dow, jumped 3.4 per cent after the company beat first-quarter profit expectations.
Verizon fell 2.4 per cent after posting a higher quarterly subscriber loss.
Northrop Grumman slumped 8.7 per cent after it reported a sharp drop in profit while RTX tumbled 8.0 per cent after the company flagged a potential hit of about $US850 million ($A1.3 billion) to annual profit from tariffs.
In early trading on Tuesday, the Dow Jones Industrial Average rose 568.66 points, or 1.49 per cent, to 38,739.07, the S&P 500 gained 69.03 points, or 1.34 per cent, to 5,227.23, and the Nasdaq Composite added 240.11 points, or 1.51 per cent, to 16,111.01.
Megacaps also recovered, with Nvidia rising 1.1 per cent and Apple up 1.7 per cent.
All sectors on the S&P 500 inched higher, with consumer discretionary taking the lead.
Tesla, which will kick off earnings for the "Magnificent Seven" group of megacap stocks after markets close, rose 2.1 per cent.
The mood, however, remained fragile as investors awaited Trump's next move in his relentless tussle with Powell over interest rates, fuelling concerns about the US central bank's autonomy and the future monetary policy path, which pushed Wall Street down more than 2.0 per cent on Monday.
Clarity on US tariff policy and the outcome of negotiations with individual countries on reciprocal levies are also in focus.
Indexes have fallen sharply this year as Trump's erratic trade policies rattled markets, with the S&P 500 more than 14 per cent below its February 19 record closing high.
A close 20 per cent below that mark would confirm that the index has entered a bear market.
The Nasdaq Composite confirmed it was in a bear market earlier this month.
The International Monetary Fund slashed its forecasts for growth in the US on Tuesday to 1.8 per cent in 2025, from 2.8 per cent growth in 2024.
Commentary from several Fed speakers is expected through the day.
Their remarks will be parsed for clues on the central bank's policy outlook and view on rising tensions with the White House.
Shares of Invesco leapt 8.7 per cent after the asset manager reported higher-than-expected quarterly profit.
Advancing issues outnumbered decliners by a 9.24-to-1 ratio on the NYSE, and by a 4.52-to-1 ratio on the Nasdaq.
The S&P 500 posted one new 52-week high and one new low while the Nasdaq Composite recorded 11 new highs and 27 new lows.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
News.com.au
5 hours ago
- News.com.au
What's driving China's hunger for Aussie beef as exports soar
Grain-fed beef exports to China have ballooned more than 40 per cent this year – and it's not only because of the Asian superpower's trade war with the US. Australia has broken records in the beef export industry so far in 2025, up 15 per cent year-on-year, to reach more than 567,000 tonnes by May. Among the biggest movers has been grain-fed exports to Greater China – which includes Taiwan and Hong Kong – rising 41 per cent to 57,000 tonnes alone. Overall beef exports to Greater China are up 30 per cent this year, rising to 117,000 tonnes in the latest data. These figures reveal how Australian beef exporters have been a big winner of Beijing and Washington's ongoing trade war sparked by Donald Trump's tariff regime. Meat & Livestock Australia general manager of markets Andrew Cox explained the uptick in trade to China had also coincided with a repairing of the political relationship between the two countries in recent years. China only lifted the last of its unofficial trade sanctions on Australian products like meat, wine and barley in December last year, which stemmed from tensions between Beijing and the previous federal government. 'And then of course, more recently, there's been some increased demand because our key competitor in that premium space in China, the US, has been effectively shut-out due to the trade relationship between China and the US.' China previously imported AU$2.5 billion worth of American meat but those products have virtually disappeared from supermarket shelves since Mr Trump's 'Liberation Day' as both countries hit each other with tariffs above 100 per cent. The growing middle class China's growing middle class and rising incomes have seen beef become a more popular source of protein – particularly premium cuts like wagyu – than it was historically. A snapshot collated by Meat & Livestock Australia shows 74 per cent of affluent Chinese consumers believe Australian beef is 'the most delicious', while it also scored highly for freshness and safety. Mr Cox, who has been in the industry for 20 years, said he remembered when Chinese trade figures were a 'rounding error' on the export database. 'Now they're the world's biggest beef importer and it's got more runway to grow,' he said. 'We've seen urbanisation, an emerging and growing middle class numbering in the hundreds of millions. And they have a demand for quality and safe protein.' Tammi Jonas, a farmer and spokeswoman for the Australian Food Sovereignty Alliance, predicted China to hoover up Aussie beef after the tariffs were announced in April. 'China has just turned immediately and said, 'Yep, that looks great. We'll have more Australian beef',' she told this week. Ms Jonas, however, has also warned of the potential for beef prices in Australian grocery stores to go up as exporters send more stock overseas. 'China buys a full range of everything from cheaper cuts to the more expensive ones,' she said. 'They have a rapidly growing middle class, so they demand more of the premium beef than historically they did. 'And Japan is the same, they both like a lot of the premium cuts from here. 'So that's direct competition with premium cuts in Australian supermarkets.' Tariffs and US trade The US President, in his April 2 speech, singled out an unbalanced beef trade as justification for slapping a blanket 10 per cent tariff on all Australian-made products. 'They won't take any of our beef. They don't want it because they don't want it to affect their farmers and, you know, I don't blame them, but we're doing the same thing right now, starting at midnight tonight,' Mr Trump said. Despite this, US importers have taken in 167,000 tonnes of Australian beef in 2025 – with its 32 per cent growth outstripping that of China. Australia's meat exports to the US totalled around $4 billion in 2024, while America has been dealing with drought conditions that have squeezed domestic cattle supply. It was revealed on Friday that the Australian government was considering relaxing biosecurity laws to allow more American beef into the country as part of tariff negotiations. Beef from the US was banned in 2003 after the breakout of mad cow disease, and since 2019 there have been strict conditions for meat products to enter Australia. The move has seen some pushback from farmers, with National Farmers Federation president David Jochinke telling the Sydney Morning Herald that protecting biosecurity was paramount for the industry. 'Let's be abundantly clear, our biosecurity isn't a bargaining chip,' he said. 'We have the world's best standards, backed by science, and that's how it needs to stay.' Cattle Australia chief executive Chris Parker on Friday said US beef producers have had access to Australian markets since 2019, provided they could show animals were born raised and slaughtered in the US. 'Our position is that the US needs to be able to demonstrate it can either trace cattle born in Mexico and Canada, or has systems that are equivalent to Australia's traceability, before imports of meat could occur from non-US cattle,' Dr Parker said. 'Cattle Australia is in ongoing communication with the Federal Government regarding this issue and the vital importance that our science-based biosecurity system is not compromised as part of trade discussions with any country.' Domestic prices So far beef prices has remained steady for farmers, as demand from importers means strong paydays along the supply chain, Ms Jonas said. 'The big exporters (in Australia) are rubbing their hands and just filling that market rapidly,' she said. 'And the more that market opens up, the more pressure it puts on domestic pricing. 'So supermarket beef, like we like we said several months ago, supermarkets beef is definitely going to keep going up in price.' Mr Cox said predicting prices was like weather forecasting but added that Australia already exported 75 per cent of the beef produced here. 'For the Australian farmer to be sustainable for that cultural sector, we need customers all around the world,' he said. 'We produce more food than we eat domestically and we're highly reliant on export markets.'
News.com.au
5 hours ago
- News.com.au
What the Trump-Musk Feud Means for SpaceX and NASA
The U.S. government relies on SpaceX to support NASA and other agencies, and the company has received more $20 billion in federal contracts for it. As Musk and Trump threaten to cut ties, here's what that would mean for the U.S.'s space ambitions.
7NEWS
6 hours ago
- 7NEWS
Donald Trump has 'no plans' to speak to Elon Musk as feud deepens over tax bill and billions in contracts
Donald Trump says he has no plans to speak with Elon Musk, signalling the US president and his former ally might not resolve their feud over a sweeping tax-cut bill any time soon. Addressing reporters on Friday aboard Air Force One, Trump said he wasn't 'thinking about' the Tesla CEO. 'I hope he does well with Tesla,' Trump said. However, Trump said a review of Musk's extensive contracts with the federal government was in order. 'We'll take a look at everything,' the president said. 'It's a lot of money.' Trump may get rid of the red Tesla Model S that he bought in March after showcasing Musk's electric cars on the White House lawn, a White House official said, speaking on condition of anonymity. Musk, for his part, did not directly address Trump but kept up his criticism of the massive Republican tax and spending bill that contains much of Trump's domestic agenda. On his social-media platform X, Musk amplified remarks made by others that Trump's 'big beautiful bill' would hurt Republicans politically and add to the nation's $US36.2 trillion ($A55.8 trillion) debt. He replied 'exactly' to a post by another X user that said Musk had criticised Congress and Trump had responded by criticising Musk personally. Musk also declared it was time for a new political party in the United States 'to represent the 80 per cent in the middle!' People who have spoken to Musk said his anger has begun to recede and they think he will want to repair his relationship with Trump, according to one person who has spoken to Musk's entourage. The White House statements came one day after the two men battled openly in an extraordinary display of hostilities that marked a stark end to a close alliance. On Thursday, Musk claimed that President Trump is listed in the Epstein files, alleging this is why they have not been released to the public. '@RealDonaldTrump is in the Epstein files. That is the real reason they have not been made public,' Musk wrote on X. 'Have a nice day, DJT!' The White House later responded, calling the claims 'an unfortunate episode from Elon'. Tesla stock rose on Friday, clawing back some losses from Thursday's session, when it dropped 14 per cent and lost $US150 billion ($A231 billion) in value, the largest single-day decline in the company's history. Musk, the world's richest person, bankrolled a large part of Trump's 2024 presidential campaign. Trump named Musk to head a controversial effort to downsize the federal workforce and slash spending. Trump feted Musk at the White House a week ago as he wrapped up his role as head of the Department of Government Efficiency. Musk cut only about half of one per cent of total spending, far short of his brash plans to axe $US2 trillion ($A3.1 trillion) from the federal budget. Since then, Musk has denounced Trump's tax-cut and spending bill as a 'disgusting abomination'. His opposition is complicating efforts to pass the bill in Congress where Republicans hold a slim majority. Trump had initially stayed quiet while Musk campaigned to torpedo the bill, but broke his silence on Thursday, telling reporters he was 'very disappointed' in Musk. Musk, who spent nearly $US300 million ($A462 million) in the 2024 elections, said Trump would have lost without his support and suggested he should be impeached. Trump suggested he would terminate government contracts with Musk's businesses, which include rocket company SpaceX and its satellite unit Starlink. The billionaire then threatened to decommission SpaceX's Dragon spacecraft, the only US spacecraft capable of sending astronauts to the International Space Station. Musk later backed off that threat. A prolonged feud could make it harder for Republicans to keep control of Congress in the 2026 midterm elections if Musk withholds financial support or other major Silicon Valley business leaders distance themselves from Trump. Musk had already said he planned to curtail his political spending, and on Tuesday called for 'all politicians who betrayed the American people' to be fired in 2026. His involvement with the Trump administration has provoked widespread protests at Tesla sites, driving down sales while investors fretted that Musk's attention was too divided.
