Wall Street Bounces Back From Monday's Sell-Off

Stocks closed higher on Wall Street Tuesday as calm returned to the market a day after its biggest pullback in almost two years.

• The S&P 500 rose 53.70 points, or 1%, to 5,240.03, breaking a brutal three-day losing streak.
• The Dow Jones Industrial Average rose 294.39 points, or 0.8%, to 38,997.66.
• The Nasdaq composite rose 166.77 points, or 1%, to 16,366.85.

Strong profit reports from Uber and other companies helped support the market. The vast majority of stocks climbed in a mirror opposite of the day before, when the unraveling of some popular trades and worries about the US economy wracked markets, the AP reports.

Kenvue, the company behind Tylenol and Band-Aids, jumped 14.7% after reporting stronger profit than expected thanks in part to higher prices for its products. Uber rolled 10.9% higher after easily topping profit forecasts for the latest quarter. Caterpillar climbed 3% after the maker of heavy machinery reported stronger earnings than expected. Nvidia rose 3.8% Tuesday and was one of the strongest forces pushing upward on the market.

The whiplash moves for financial markets globally have been the result of several technical factors, not just worries ignited by several weaker-than-expected reports on the US economy, in what strategists at Barclays called "a perfect storm" for causing extreme market moves. One is centered in Tokyo, where a favorite trade for hedge funds and other investors began unraveling last week after the Bank of Japan made borrowing more expensive by raising interest rates above virtually zero. Japan's Nikkei 225 jumped 10.2% Tuesday to claw back much of its 12.4% sell-off the day before, which was its worst since the Black Monday crash of 1987.

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"The speed, the magnitude, and the shock factor clearly demonstrate" how much of the moves were driven by how traders were positioned, according to the strategists at Barclays. It wasn't just worries about the US economy, but some voices along Wall Street are continuing to urge caution. Barry Bannister, chief equity strategist at Stifel, is warning more drops could be ahead because of a slowing US economy and sticky inflation. The stock market's "dip is not a blip," he warned in a report, and called it "too soon to jump back in." (More stock market stories.)