Strong earnings reports from several big retailers helped drive stocks broadly higher Wednesday on Wall Street as the market bounced back from its first loss in four days.
Target notched its biggest-ever gain, while Lowe’s had its best day in more than a year, leading a broad rally in companies that rely on consumer spending. Nordstrom, Kohl’s, Gap and other retailers closed higher.
Technology companies accounted for a big share of the gains. Financial stocks rose as bond prices fell, pushing yields higher. Real estate and materials stocks lagged the rest of the market.
Investors have been worried U.S. economic and corporate earnings growth could stumble under the strain of a slowing global economy and the costly trade war between the U.S. and China. However, the strong quarterly results from the retailers encouraged traders, who see the performance as a sign that U.S. consumers, which account for 70 percent of U.S. economic growth, are healthy.
“We had a couple of great earnings reports this morning, especially Target, which is a good barometer of the consumer,” said Dan Heckman, national investment consultant at U.S. Bank Wealth Management. “The consumer still appears to be spending and doing well.”
The S&P 500 rose 23.92 points, or 0.8 percent, to 2,924.43. The Dow Jones Industrial Average gained 240.29 points, or 0.9 percent, to 26,202.73. The Nasdaq added 71.65 points, or 0.9 percent, to 8,020.21. The Russell 2000 index of smaller company stocks picked up 11.84 points, or 0.8 percent, to 1,509.85.
Major indexes in Europe also finished broadly higher.
The stock market has been volatile this month as investors try to parse conflicting signals on the U.S. economy and determine whether a recession is on the way. A key concern is that the U.S.-Chinese tariff war will weigh on global economic growth.