Dow Adds 146 Points on Solid Earnings and Outlooks
The Dow gained 1.4% to close at 10,363, while the broader S&P 500 ($INX) rose 17 points, or 1.5%, to 1,095. The more volatile, tech-heavy Nasdaq Composite ($COMPX) gained 44, or 2%, to finish at 2,242.
Aluminum giant Alcoa set a buoyant tone when it unofficially kicked off earnings season late Monday with numbers that exceeded Wall Street estimates on the top and bottom lines. Even better, the Dow component lifted its outlook for aluminum demand. Railroad CSX also posted Street-beating earnings after Monday's closing bell.
Those early earnings outlooks and additional indications of financial stability overseas gave traders a renewed appetite for risk Tuesday, wrote John Stoltzfus, market strategist at Ticonderoga Securities, in a note to clients.
"Alcoa's better-than-expected results and, more important, management's positive forward view of the landscape along with a well received auction of Greek Treasury notes today are defending the case for upward lift based on a global economic recovery that remains a work in progress," Stoltzfus wrote.
Whether stocks can extend their rally to a seventh straight session will partly hinge on Intel's (INTC) earnings report and outlook, which will be released after Tuesday's market close. The Dow component and world's largest semiconductor maker is an early-cycle stock, meaning it is finely attuned to global demand and tends to move in advance of the broader market.
Still, the market has come a long way off the 2010 closing lows it notched just before Independence Day. Since July 2 the Dow, S&P 500 and Nasdaq have rallied more than 7%.