Wall Street closes notably higher, led by Apple

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Wall Street ended sharply higher on Tuesday, supported by Apple, Tesla and other big growth stocks, after strong retail sales in April eased concerns about slowing economic growth.

Ten of the S&P’s 11 major sector indexes rose, with financials, materials, consumer discretionary and technology all up more than 2 percent.

Data showed U.S. retail sales rose 0.9% in April, cheering investors as choice improved as consumers bought cars and frequented restaurants.

Shares of Microsoft Corp, Apple Inc, Tesla Inc and Amazon, which were recently punished, rose 2% to 5.1%, pushing the S&P 500 and Nasdaq higher.

Tuesday’s broad rally came after weeks of U.S. stocks selling off last week when the S&P 500 fell to its lowest level since March 2021.

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“The biggest stocks that investors tend to buy have basically been destroyed. They are either in correction or in bear market territory,” said Sylvia Jablonski, chief investment officer at Defiance ETFs. “I think investors are looking for those who buy on dips. Chances are, I doubt today is a good day. ”

The S&P 500 bank index rose 3.8% and Citigroup rose nearly 8% after Warren Buffett’s Berkshire Hathaway announced it would invest nearly $3 billion in the U.S. bank.

A separate set of economic data showed industrial production rose 1.1% last month, beating expectations for a 0.5% rise and faster than March’s 0.9% rise.

“This is consistent with continued economic growth in the second quarter, not a prolonged recession,” said Bill Adams, chief economist at Dallas Commercial Bank.

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

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The S&P 500 gained 2.02% to close at 4,088.85.

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

The S&P 500 has risen or fallen about 39 times in a single session so far in 2022, compared with 24 in all of 2021, underscoring recent volatility on Wall Street.

GRAPHIC-S&P 500 Busiest Trades – https://fingfx.thomsonreuters.com/gfx/mkt/zgpomemlwpd/SPX_by_busiest_trades.png

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Shares of Walmart tumbled 11.4% after the retail giant cut its annual earnings guidance, signaling a decline in its profit margins. It was the biggest one-day percentage drop in Walmart stock since 1987.

Retailers Costco, Target and Dollar Tree fell 0.8% to 3.2%.

United Airlines Holdings rose 7.9% after the airline raised its revenue forecast for the current quarter and boosted shares of Delta Air Lines, American Airlines and Spirit Airlines.

Concerns about conflict in Ukraine, rising inflation, China’s COVID-19 lockdown and aggressive monetary tightening by the central bank overshadowed the positive earnings season in the first quarter.

So far in 2022, the S&P 500 is down about 14% and the Nasdaq is down about 23%, hit by a decline in growth stocks.

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

New stocks dominate at a 2.92-to-1 ratio on the NYSE; on Nasdaq, a 3.19-to-1 ratio favors movers.

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

Volume on U.S. exchanges was 12 billion shares, compared with the 13.3 billion average over the past 20 sessions.

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