U.S. equities rallied Tuesday as major indices notched a sixth consecutive day of gains, continuing a powerful rebound fueled by improving breadth, waning volatility, and cautious optimism around upcoming economic and corporate catalysts. The Dow Jones Industrial Average gained 300 points (+0.75%), the S&P 500 climbed 0.58%, and the Nasdaq Composite added 0.55%, extending the market’s recent uptrend even amid choppy intraday action.

Early trading was marked by hesitation as investors digested softer consumer sentiment and weaker labor demand data. However, bulls regained control by midday, aided by Treasury strength and a flurry of tariff-related comments that sparked a fresh wave of optimism. Notably, President Trump’s late-day announcement, which had been rumored earlier in the day,of modified auto tariffs aimed at incentivizing domestic production lifted industrial sentiment, while Commerce Secretary Howard Lutnick’s CNBC remarks that a 10% tariff “won’t materially raise prices” further calmed inflation nerves.

Momentum continues to dominate the narrative. Tuesday’s close marked the sixth straight daily gain for the S&P 500, with analysts noting that if the index closes above 5,611.85 tomorrow, it would make April the first month since 1952 to end green after a 10%+ intra-month drop. That level is now a clear psychological and technical inflection point for traders.

Sector Performance: Broad-Based Strength, Energy Lags

Gains were broad across the board, with 10 of 11 S&P sectors closing higher. Leading the way were:

• Technology: Cybersecurity (BUG +1.17%) and Software (IGV +1.04%) outperformed as risk appetite returned.
• Financials (XLF +1.04%) and Regional Banks (KRE +0.90%) rebounded on stable yields.
• Consumer Discretionary (XLY +0.73%) and Health Care (XLV +0.49%) each extended their six-session win streaks.

At the bottom of the ledger:

• Energy (XLE -0.70%) was the only S&P sector in the red as WTI crude dropped 2.63% to $60.42/bbl, its lowest level since early April.
• Precious metals also sold off, with SLV (Silver) down -1.01% and GDX (Gold Miners) down -0.97%, as real rates moved higher and the dollar caught a bid.

Economic Underpinnings: Data Tilts Cautious

Treasuries posted another solid session, with yields moving lower across the curve. The 10-year yield dropped to 4.17%, while the 2-year yield slipped to 3.66%, marking its lowest close for the month ahead of a massive day of data.

Markets absorbed several reports Tuesday with a distinctly cautious tone:

• Consumer Confidence (April) fell to 86.0 (lowest since 2020), missing expectations and revealing deteriorating views on jobs and income.
• March JOLTS Job Openings came in at 7.192M vs. consensus 7.5M.
• The March goods-trade deficit ballooned to a record $162B, pointing to tariff-frontloading distortions that may weigh on Q1 GDP.
• Dallas Fed’s Texas service sector survey revealed worsening business activity outlook (-19.4 from -11.3).

Despite the mixed tone in the data, investors largely shrugged off the soft signals as positioning remained anchored to the ongoing earnings cycle and anticipation of peak inflation readings.

Trade and Tariffs: Market Reactions and Political Headlines

Late-session strength was supported by a string of trade headlines. Commerce Secretary Lutnick confirmed that a trade deal with an unnamed country was close to approval, reinforcing optimism around tariff resolution. Meanwhile, President Trump’s proclamation on domestic auto production incentives is being viewed as both a political and economic signal: the administration remains focused on reducing foreign supply chain dependence without immediately triggering consumer price shocks.

The plan includes partial tariff offsets for domestic production, effectively lowering the cost burden on manufacturers assembling cars in the U.S. It’s a meaningful policy lever that could benefit a swath of automakers and parts suppliers, including F, GM, TSLA, STLA, AXL, BWA, and others.

The Road Ahead: Data and Earnings On Deck

All eyes now turn to Wednesday’s economic gauntlet, including:

• ADP private payrolls (8:15 AM ET): est. +115K
• Q1 GDP (8:30 AM): est. +0.4%, down from Q4’s +2.4%; the Atlanta Fed GDPNow sits as low as -2.7% (gold adjusted -1.5%)
• Core PCE (Mar): est. +0.1% MoM / +2.6% YoY
• Employment Cost Index: est. +0.9%
• Chicago PMI (9:45 AM): est. 45.5
• Personal income/spending, pending home sales (10:00 AM

This data will be pivotal in confirming or challenging the Fed’s current stance. Powell has reiterated that it may take longer to gain confidence that inflation is on a sustainable path toward the 2% target. His own estimate for March core PCE is +2.6% YoY, slightly above expectations. Any deviation could sway market rate-cut expectations meaningfully.

Final Thoughts

With big earnings still to come from Apple, Amazon, Meta, and Microsoft, plus tomorrow’s avalanche of economic data, the rally faces real tests. For now, momentum is winning the day. But with the S&P eyeing a historic monthly milestone, any misstep on inflation or growth could trigger renewed volatility.