The political flare-ups come amid a critical earnings season, which investors hope will offer some clarity amid the chaos.
U.S. markets extended morning gains to stage a strong comeback on Tuesday, clawing back losses from a bruising previous session, even as investors weighed mounting global trade tensions and fresh political heat directed at Federal Reserve Chair Jerome Powell by President Donald Trump.
The Dow Jones Industrial Average surged 835 points, or 2.2 percent, snapping a four-day losing streak. The S&P 500 also advanced 2.2 percent, while the tech-heavy Nasdaq Composite led the charge with a 2.5 percent gain.
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Heavyweights in tech and industrials helped lift sentiment. Shares of Tesla rose 4 percent ahead of its quarterly results due later in the day. Netflix rallied 7 percent, while Amazon and Meta gained 3 percent and 1 percent, respectively. Manufacturing giant 3M jumped 8 percent on stronger-than-expected earnings, providing a boost to the blue-chip Dow.
The rebound followed a sharp sell-off on Monday, when the Dow plunged over 970 points and the Nasdaq and S&P 500 each fell more than 2 percent, weighed down by rising geopolitical tensions and unease around central bank policy.
Much of the anxiety has been stirred by President Donald Trump’s recent outbursts targeting Fed Chair Powell. In a string of posts on Truth Social, Trump blamed Powell for delaying rate cuts, calling him “Mr. Too Late” and a “major loser.” He also hinted at Powell’s removal—an unprecedented suggestion—though Powell has maintained that he is protected by law and will serve his full term through May 2026.
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The political flare-ups come amid a critical earnings season, which investors hope will offer some clarity amid the chaos. With Tesla’s results expected after the bell and more big names lined up, markets will now look for guidance on whether corporate America sees the recent volatility as a blip or a broader turning point.
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European markets bounced back on Tuesday, reversing earlier losses as a strong opening on Wall Street lifted investor sentiment. The pan-European Stoxx 600 closed 0.24 percent higher, with most major regional bourses ending in positive territory. While construction and healthcare stocks slipped around 0.7 percent, the household goods sector led gains with a 1.7 percent rise.
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