US stock markets advanced during Tuesday's early session as traders assessed a flurry of corporate earnings reports and a rise in oil prices. Shares of International Business Machines Corp. (IBM) plunged following a profit warning.
The Dow Jones Industrial Average gained 100.14 points, or 0.19%, to 52,598.78. The Nasdaq Composite rose 92.38 points, or 0.36%, to 25,965.56. The S&P 500 index increased by 12.39 points, or 0.16%, to 7,527.73.
International Business Machines Corp. (IBM) shares tumbled 23.5% in early trading after the company released preliminary second-quarter results, showing adjusted earnings per share of $2.93, which fell short of the FactSet consensus estimate of $3.01.
Several major banks, including JPMorgan Chase & Co., Wells Fargo & Co., Bank of America Corp., and Citigroup Inc., also reported their second-quarter results, with their shares trading in negative territory. Goldman Sachs Group Inc. posted results that exceeded expectations, leading its stock to rise more than 1%.
Semiconductor stocks rebounded following a sell-off in the prior session. The VanEck Semiconductor ETF was up over 2% in pre-market activity. Applied Materials Inc. gained more than 4%, while Lam Research Corp., STMicroelectronics N.V., Teradyne Inc., and Micron Technology Inc. all rose more than 3%.
On Monday, major US stock benchmarks had declined after former President Donald Trump stated he would reimpose a blockade on shipping through the critical Strait of Hormuz targeting Iran.
"We are reimposing the 'Iran Blockade,' so named because it only blocks Iranian vessels or customers," Trump posted on Truth Social.
Following Trump's announcement, oil prices surged and equities fell on Monday. Brent crude oil jumped over 9%, marking its largest single-day gain since 2020. On Tuesday, US crude oil prices surpassed $80 per barrel, recently up 2% for the day. The international benchmark Brent crude futures rose 2% to above $86 per barrel.
On the economic data front Tuesday, the US Consumer Price Index for June showed a year-over-year increase of 3.5%, which was lower than the average estimate of 3.8% from analysts surveyed by Dow Jones, primarily due to a decline in energy prices last month.
Federal Reserve Chair Kevin Warsh is also scheduled to meet with lawmakers on Capitol Hill Tuesday as part of his two-day Humphrey-Hawkins testimony on monetary policy. This marks the first submission of the central bank's semi-annual report by the new Fed Chair.
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