Airline, Big Tech Stocks Lead Broad Wall Street Rally

NEW YORK - Wall Street rose on Tuesday after a series of reports that the economy was doing better than expected.

The S&P 500 rose 1.1%, extending its rally earlier this month to its highest level in more than a year. The Dow Jones Industrial Average rose 212 points, or 0.6%, and the Nasdaq Composite rose 1.6%.

Delta Air Lines said it continues to see lower demand in the pipeline as passengers make up for lost opportunities to travel during the pandemic as airlines help steer the way. It highlighted particularly high-net-worth customers, who account for three-quarters of their spending on air travel and still appear to be in good financial shape despite high inflation.

Shares of Delta rose 6.8% after it said this year's earnings would beat the previously forecast range. American Airlines rose 5.5% and United Airlines rose 5.1%.

Big tech stocks were also strong, continuing their strong run this year driven by enthusiasm for artificial intelligence technology. Nvidia, at the center of the AI ​​craze, saw its annual profit rise 3.1%, to 186.5%.

However, high inflation directly hurts other companies. Shares of Walgreens Boots Alliance fell 9% after reporting lower-than-expected earnings for the fourth quarter. The drugstore retailer also lowered its revenue forecast for this fiscal year, saying consumers are more cautious about their spending and looking for more value due to higher inflation.

Shares of Lordstown Motors fell 17.2 percent after the electric pickup maker filed for Chapter 11 bankruptcy protection in early May, warning that it was at risk of bankruptcy over a dispute with electronics firm Foxconn. .

The US stock market has taken a hit this year despite higher interest rates to tame inflation as the economy has so far avoided recession. But many investors are delaying rather than canceling their predictions of an onset of recession.

Tuesday's economic reports were much stronger than expected. The consumer confidence reading reached its highest level since early 2022 and durable goods orders rose unexpectedly, beating economists' expectations of a decline.

New home sales in May also beat economists' expectations, boosting homebuilders stocks. Lina shares rose 4.1%, while Toll Brothers rose 3.3%.

The amount of industrial activity declined in the region, from Richmond, Virginia to Maryland and South Carolina, but not by as much as economists had feared. Manufacturing is one of the sectors most affected by extremely high interest rates.

Any economic data will influence the decisions of the Federal Reserve and other central banks about keeping interest rates higher. Higher rates may reduce inflation, but they do so by slowing down the entire economy and increasing recession risks.

The S&P 500 rose 49.59 points, to 4,378.41. The Dow index increased by 212.03 points to 33926.74 points, and the Nasdaq index increased by 219.89 points to 13555.67 points.

In Asian markets, shares rose 1.2% in Shanghai. leader no. Chinese Premier Li Qiang, No. 2, said economic growth has accelerated and could reach the government's 5% target this year. Speaking at the conference, Lee didn't give the growth rate for the most recent quarter, but said it was faster than the previous quarter's 4.5%.

Hong Kong shares also rose 1.9%, although Asia and Europe were quieter.

In bond markets, the yield on the 10-year US Treasury rose to 3.76% from 3.72% last Monday. Helps set rates for mortgages and other major loans.

The two-year Treasury yield rose to 4.76% from 4.74%, beating the Fed's forecast.

Information for this article was provided by Matt Ott and Joe McDonald of the Associated Press.

Stocks Extend Gains as Wall Street Heads to End of Quarter: Stock News Today