The White House granted some exemptions to its export blacklist on Huawei, giving some customers and suppliers of China’s telecom giant a 90-day reprieve from the ban.
John Vail, chief global strategist at Nikko Asset Management, said the administration's 90-day reprieve on the Huawei ban "gives both sides more time to cool down and consider whether they’re going to take the step into the abyss,” according to Dow Jones.
Kohl's reported that its first-quarter earnings missed analyst expectations, although sales topped expectations. J.C. Penney posted a wider-than-expected loss in the first quarter and same-store sales were also weaker than Wall Street expected.
Morgan Stanley analysts cut their worst-case scenario for Tesla shares to $10 per share to $97 Tuesday, a move which initially hit the stock but then it climbed back into positive territory.
The Dow Jones Industrial Average and benchmark S&P 500 index saw their first gain in three sessions and the SP500 remains about 3 percent from its record high. One reason for the gains is that investor sentiment has been getting a boost from the surprisingly strong first-quarter results.
"We consider first-quarter earnings season a success based on the upside surprise and resilience of estimates for the rest of this year," John Lynch, chief investment strategist at LPL Financial, said in a statement. "It appears an earnings recession has been averted and better earnings days lie ahead, though trade uncertainty is a huge wild card.
"Our base case remains that we will get a trade deal with China early this summer and consensus expectations for 3–4% earnings growth may prove to be conservative," he said. "Earnings are hardly booming, but with a continued economic expansion, low inflation, and low interest rates, we see enough earnings growth ahead to push stocks up to our year-end S&P 500 fair value target of 3,000 — though it probably won’t get there in a straight line."
|I:DJI||DOW JONES AVERAGES||33700.18||-884.70||-2.56%|
|I:COMP||NASDAQ COMPOSITE INDEX||14564.822976||-479.14||-3.19%|
The yield on the 10-year Treasury edged higher to 2.43 percent, its second day of gains, even though existing home sales fell in April for second straight month.
Crude oil prices were little changed as U.S.-China trade worries weighed on energy demand prospects even though Middle East tensions provided some support. U.S. WTI crude traded at $62.99 a barrel Tuesday afternoon.