Dow jumps more than 200 points
U.S. stocks rallied Tuesday, with the Dow jumping by triple-digits in early trade and the Nasdaq hitting a milestone, as investors' optimism accelerated on upbeat earnings and the possibility of tax reform.
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The Dow Jones Industrial Average rose 229 points, or 1.1%, to 20,993, outperforming other benchmarks after five of its components reported quarterly results (http://www.marketwatch.com/story/dow-getting-an-87-point-boost-from-earnings-led-by-caterpillar-and-3m-stock-rallies-2017-04-25), with four of them coming in ahead of forecasts.
Caterpillar Inc.(CAT) lifted its full-year revenue outlook (http://www.marketwatch.com/story/caterpillar-shares-soar-after-first-quarter-earnings-beat-2017-04-25) and reported better-than-expected results, sending shares up more than 6%. Fellow Dow component DuPont (http://www.marketwatch.com/story/dupont-offers-downbeat-outlook-for-current-quarter-2017-04-25)(DD) rose nearly 3% after topping analyst forecasts.
Fast-food giant McDonald's Corp. (MCD) gained 4.9% after it served up first-quarter earnings (http://www.marketwatch.com/story/mcdonalds-shares-rise-after-earnings-beat-estimates-2017-04-25) that beat expectations. Coca-Cola Co. (KO)reported a drop (http://www.marketwatch.com/story/coke-expands-cost-cuts-after-latam-weakness-2017-04-25) in its first-quarter earnings and sales, but shares were nearly flat.
Meanwhile, the S&P 500 was up 13 points, or 0.6%, to 2,387, with 10 of the main 11 sectors trading higher. Materials and financials were leading gains, up more than 1%. The index is less than 10 points below its record close.
The Nasdaq Composite Index rose 37 points, or 0.6%, to 6,021, trading in record territory, and surpassing a psychologically important milestone of 6,000.
Checkout: Nasdaq hits 6,000 for first time ever-marking historic milestone (http://www.marketwatch.com/story/nasdaq-hits-6000-for-the-first-time-evermarking-historic-milestone-amid-stock-market-rally-2017-04-25)
Strong corporate quarterly results were seen as a sign that the market's recent move higher, which took major indexes to repeated records and raised concerns about valuation, may be justified by better-than-expected earnings.
See: Are planets aligned for a renewed stock market rally? (http://www.marketwatch.com/story/are-planets-aligned-for-a-renewed-stock-market-rally-2017-04-24)
"Today is one of the busiest days in terms of corporate earnings releases, with 36 companies reporting before and after the market and so far earnings have been strong," said Michael Antonelli, equity sales trader at Robert W. Baird & Co.
"While earnings have been driving markets higher, tax cuts would drive multiple expansion and so far it looks like the market is very optimistic on tax cuts," Antonelli said.
(http://www.marketwatch.com/story/dupont-offers-downbeat-outlook-for-current-quarter-2017-04-25)Read: Trump seeks corporate tax rate of 15% in plan (http://www.marketwatch.com/story/trump-seeks-corporate-tax-rate-of-15-in-plan-2017-04-24)
In the back of investors' minds are worries about a potential government shutdown on Saturday. But those may have eased, after Trump backed off on a demand for border-wall funding (http://www.marketwatch.com/story/trump-backs-off-demand-for-immediate-border-wall-funding-2017-04-24) seen as blocking a deal.
See:Should Wall Street fear a government shutdown? (http://www.marketwatch.com/story/should-wall-street-fear-a-government-shutdown-heres-how-stocks-fared-during-past-closures-2017-04-21)
Economic data:U.S. house prices continued to show no signs of slowing (http://www.marketwatch.com/story/us-house-prices-show-no-sign-of-slowing-2017-04-25), hitting their highest in nearly three years as demand remains hot. Meanwhile, sales of newly-constructed homes (http://www.marketwatch.com/story/new-home-sales-roar-to-an-8-month-high-as-spring-selling-season-starts-with-a-bang-2017-04-25)rose to the highest in nearly a year in March as the housing recovery picked up steam.
Consumer confidence in the U.S. dipped slightly in April, but Americans are still far more optimistic than they were before the 2016 election, a survey shows.
Check out:After 17 years, S&P 500 tech sector finally regains lost ground (http://www.marketwatch.com/story/after-17-years-sp-500-tech-sector-finally-regains-lost-ground-2017-04-24)
Stock movers: An long list of companies are reporting on Tuesday. In addition to the Dow stocks, results from Biogen Inc (http://www.marketwatch.com/story/dupont-offers-downbeat-outlook-for-current-quarter-2017-04-25).(BIIB) lifted the biotech firm by 5%. Rite Aid Corp.(RAD) jumped 6.2% on an earning beat (http://www.marketwatch.com/story/rite-aid-shares-jump-after-earnings-beat-2017-04-25).
3M Co (http://www.marketwatch.com/story/3ms-stock-jumps-after-profit-and-sales-rise-above-expectations-2017-04-25). (MMM) shares were off 0.9% after earnings results.
Lockheed Martin Corp.(LMT) shares fell 2.2% after the company reported lower-than-expected revenues.
Eli Lilly & Co (http://www.marketwatch.com/story/eli-lilly-swings-to-loss-on-higher-sales-cuts-2017-eps-view-2017-04-25).(LLY)swung to a first-quarter loss (http://www.marketwatch.com/story/eli-lilly-swings-to-loss-on-higher-sales-cuts-2017-eps-view-2017-04-25), stemming from the drugmaker's purchase of CoLucid Pharmaceuticals Inc. Shares fell 2.5%.
Straight Path Communications Inc.(STRP) rose nearly 10% after the telecommunications company said that AT&T Inc. (T) has five days to match a "superior" buyout bid it has received. (http://www.marketwatch.com/story/straight-path-says-att-has-5-days-to-match-a-superior-buyout-bid-it-received-2017-04-25)
Tyson Foods (TSN) agreed to acquire (http://www.marketwatch.com/story/tyson-foods-to-acquire-advancepierre-foods-holdings-for-42-bln-2017-04-25-7914111)AdvancePierre Foods Holdings Inc.(APFH) in a deal valued at $4.2 billion. Shares of Tyson gained 2% while AdvancePierre surged nearly 10%.
Read:Three infrastructure stocks to buy -- regardless of Trump's spending plans (http://www.marketwatch.com/story/three-infrastructure-stocks-to-buy-regardless-of-trumps-spending-plans-2017-04-25)
Other markets: European stocks rose modestly (http://www.marketwatch.com/story/european-stocks-snag-modest-gains-after-french-election-rally-2017-04-25) after the prior day's French election rally, while in Asia equities rose across the board (http://www.marketwatch.com/story/asian-stocks-build-on-gains-and-this-time-china-joins-in-2017-04-24).
Investors in Asia kept a close eye on tensions on the Korean Peninsula. North Korea marked the anniversary of the founding of its military with a large live-fire exercise, as a U.S. aircraft carrier strike group docked in South Korea as planned, reported Reuters (http://www.marketwatch.com/story/north-korea-reportedly-conducts-live-fire-exercise-as-us-submarine-docks-in-the-south-2017-04-25). There had been concerns that North Korea could mark Tuesday's anniversary with another nuclear test of a long-range missile.
See:White House calls in all 100 senators for unusual briefing on North Korea (http://www.marketwatch.com/story/white-house-to-brief-full-senate-as-trump-calls-north-korea-real-threat-to-the-world-2017-04-24)
The dollar rose against the yen, but fell against the euro and British pound .
Oil prices (http://www.marketwatch.com/story/oil-rises-as-bargain-hunters-snap-to-attention-2017-04-25) edged lower, while gold prices saw fresh losses, down $8.7 to $1,268.70 an ounce.
Ryan Vlastelica contributed to this article.
(END) Dow Jones Newswires
April 25, 2017 12:07 ET (16:07 GMT)