Wall Street Rises as Growth Stocks Lead Gains
U.S. stock markets moved higher on Tuesday, supported by strong performance in growth stocks and a softer-than-expected U.S. inflation report.
Investors also monitored developments in Middle East ceasefire talks while shifting focus toward a new round of major bank earnings.
At 10:47 ET, the S&P 500 gained 0.7% to 6,932.83, recovering all losses linked to the Iran conflict. The Nasdaq Composite rose 1.2% to 23,459.15, while the Dow Jones Industrial Average advanced 0.4% to 48,398.87.
Cooler PPI Data Supports Market Sentiment
Inflation data played a key role in boosting investor confidence. The U.S. Producer Price Index (PPI) increased by 0.5% month-on-month and 4.0% year-on-year in March, both below expectations of 1.1% and 4.6%.
Core PPI, which excludes food and energy, rose just 0.1% on the month and 3.8% annually, indicating that underlying inflation pressures may be easing.
Although headline inflation marked its strongest annual increase since early 2023, this was largely driven by an 8.5% surge in energy prices linked to the Iran conflict.
Core Inflation Trends Offer Reassurance
Analysts noted that the moderation in core inflation is a positive signal for markets. Slower underlying price growth suggests that inflation may not be accelerating uncontrollably, despite recent spikes in energy costs.
This dynamic has helped ease concerns that central banks may need to keep interest rates elevated for longer.
IMF Warns of Slower Global Growth
Global economic concerns remain in focus. The International Monetary Fund (IMF) recently downgraded its growth outlook, projecting global expansion of 3.1% this year and 3.2% in 2027.
The IMF warned that the ongoing Middle East conflict poses a significant risk to global economic stability.
Markets Recover After Prior Session Rebound
Wall Street had already staged a strong rebound in the previous session, as initial disappointment over stalled U.S.-Iran talks faded.
President Donald Trump indicated that Iranian officials had reached out to negotiate, raising hopes for a potential agreement while reaffirming that Iran would not be allowed to develop nuclear weapons.
Geopolitical Risks Remain Elevated
Despite diplomatic signals, tensions remain high. The U.S. blockade of Iranian ports continues to threaten oil flows through the Strait of Hormuz, a critical global energy route.
At the same time, reports suggest ongoing communication between Washington and Tehran, with potential progress toward extending a temporary ceasefire.
Pakistan has emerged as a key mediator, offering to host further negotiations following initial talks in Islamabad.
Separately, Israel and Lebanon are set to begin direct peace talks in Washington, with U.S. Secretary of State Marco Rubio expected to participate.
Oil and Dollar Ease on De-escalation Hopes
Oil prices fell below $100 per barrel amid cautious optimism over a potential diplomatic resolution, though they remain elevated compared to pre-conflict levels.
Brent crude dropped 3.9% to $95.47, while U.S. West Texas Intermediate declined 6% to $93.17.
The U.S. dollar also weakened slightly as investors shifted toward riskier assets.
Bank Earnings in Focus as Trading Drives Results
Attention is now turning to earnings from major U.S. banks.
JPMorgan reported better-than-expected revenue and profit, supported by strong trading activity during recent market volatility. CEO Jamie Dimon, however, warned of increasing economic risks, including geopolitical tensions, energy price volatility, and uncertain trade conditions.
Citi also exceeded expectations, benefiting from gains in its trading business. Its shares rose 1.9%, while JPMorgan stock edged slightly lower.
In contrast, Wells Fargo missed revenue estimates and reported weaker-than-expected net interest income, sending its shares down 5.5%.
Amazon Deal Lifts Globalstar Shares
In corporate news, Globalstar shares surged 9.8% after the satellite company agreed to be acquired by Amazon in a deal valued at $11.57 billion.
