U.S. stocks rose Tuesday, extending gains from the previous session amid increasing optimism over interest rate cuts, with retail sales failing to grow in June.
At 09:35 ET (13:35 GMT), Dow Jones Industrial Average rose 235 points, or 0.6%, S&P 500 climbed 18 points, or 0.3%, and NASDAQ Composite gained 70 points, or 0.4%.
Retail sales flat in June; rate cut optimism grows U.S. retail sales were unchanged in June on a monthly basis, according to data released earlier Tuesday, following on from an upwardly revised 0.3% gain in May.
This release was stronger than the expected fall of 0.3% expected, after a previously reported 0.1% gain in May, but the outlook for sales is still difficult with households becoming more price sensitive and focusing on basic needs, as interest rates remained elevated.
Optimism is growing that the Federal Reserve will start an interest-rate cutting cycle in September.
Fed head Jerome Powell said that recent inflation readings had boosted the Fed’s confidence in lower inflation, ramping up bets that the central bank was close to cutting interest rates.
Powell had earlier signaled that the Fed did not have to wait for inflation to reach 2% before cutting rates. .
Traders were now looking at a 89% chance the central bank will cut rates by 25 basis points in September, with a small chance of a 50-basis-point cut, according to CME Fedwatch.
Trump names running mate as shooting boosts presidential odds Wall Street has largely shrugged off any political uncertainty stemming from an assassination attempt on Trump at a Pennsylvania rally over the weekend..
Trump on Monday was officially nominated as the Republican frontrunner for the 2024 presidential race, and named Ohio Senator J.D. Vance as his vice presidential running mate.
Trump’s chances of a victory were seen increasing sharply after the shooting over the weekend, with a Trump presidency presenting the prospect of a looser regulatory environment in the country.
More bank earnings in focus The banking sector has remained in focus Tuesday, with Bank of America (NYSE:BAC) stock rising around 3% after the lender reported second-quarter revenue and profit topping expectations on rising investment banking and asset management fees.
By contrast, Morgan Stanley (NYSE:MS) and Charles Schwab (NYSE:SCHW) both fell after failing to meet elevated expectations.
Match Group (NASDAQ:MTCH) stock rose over 6% following a report activist investor Starboard has a stake of more than 6.5% in the Tinder owner and was pushing for a possible sale if a turnaround wasn't successful.
Trump Media & Technology Group (NASDAQ:DJT) stock fell 8%, pulling back after closing up 31% a day earlier amid a broader rally in the so-called Trump trade across markets.
Crude heads lower Crude prices slipped lower Tuesday, on continued worries of a slowing Chinese economy.
By 09:35 ET, the U.S. crude futures (WTI) dropped 1.7% to $79.48 a barrel, while the Brent contract fell 1.6% to $83.53 a barrel.
The world's second-largest economy, and largest crude importer, registered its weakest growth since the first quarter of 2023,
The latest forecast of U.S. crude inventories, from the American Petroleum Institute, are due later in the session.
