Wall Street opens higher, led by rebounding tech stocks

A woman wearing a face mask walks past a bank's electronic board showing the Hong Kong share index in Hong Kong, Tuesday, May 17, 2022. Shares advanced in Asia on Tuesday after another wobbly day on Wall Street extended a losing streak for markets. (AP Photo/Kin Cheung)

People wearing face masks stand in front of a bank's electronic board showing the Hong Kong share index in Hong Kong, Tuesday, May 17, 2022. Shares advanced in Asia on Tuesday after another wobbly day on Wall Street extended a losing streak for markets. (AP Photo/Kin Cheung)

A man wearing a face mask walks past a bank's electronic board showing the Hong Kong share index in Hong Kong, Tuesday, May 17, 2022. Shares advanced in Asia on Tuesday after another wobbly day on Wall Street extended a losing streak for markets. (AP Photo/Kin Cheung)

Pedestrians pass the New York Stock Exchange, May 5, 2022, in the Manhattan borough of New York. Stocks are opening modestly lower on Wall Street Monday, May 16, 2022 continuing a losing streak that has brought the market down for six weeks in a row. The S&P 500 was down 0.6% in the early going, while more declines in technology companies pulled the Nasdaq down 1.1%. The Dow Jones Industrial Average fell 0.3%. Spirit Airlines rose 7% after JetBlue said it would make a hostile offer for the budget carrier after Spirit rebuffed its earlier bid. (AP Photo/John Minchillo, File)

NEW YORK (AP) — Stocks are opening higher on Wall Street Tuesday, led by a rebound in the highly volatile technology sector. The S&P 500 index rose 1.3% and the tech-heavy Nasdaq rose 2%. The Dow Jones Industrial Average was up 0.9%. Apple rose 1.8% and Microsoft added 2.3%. Several retailers were making big moves after reporting their latest quarterly results. Walmart sank 9% after reporting earnings that fell far short of what analysts were expecting. Home Depot rose after its results came in much better than expected. The yield on the 10-year Treasury note, a benchmark for mortgages, rose to 2.97%.

THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.

Wall Street was heading toward a strong open on Tuesday as investors took in another batch of earnings from retailers that could reveal how persistent inflation is impacting consumer spending.

Futures for the S&P 500 jumped 1.5% while the same for the Dow industrials was 1.1% higher, despite mounting doubts over the U.S. economic outlook that has dragged down markets for six weeks.

The Commerce Department reported Tuesday that retail sales in April rose 0.9%, a solid increase that underscores Americans’ ability to keep ramping up spending even as inflation persists at nearly a 40-year high.

Investors also are watching for comments by Federal Reserve officials that might provide insight into the U.S. economic outlook and future policy moves.

Signs of progress in China’s effort to bring outbreaks of coronavirus under control appeared to be outweighing concern over weaker than expected U.S. and Chinese economic data.

“Markets remain in fight or flight mode while rolling the dice on recession odds,” Stephen Innes of SPI Asset Management said in a report. He added that, “traders seem to be in the mood to stay bearish until proven otherwise. However, there is still a lingering risk- on tone despite horrific Chinese data.”

In Europe, Germany's DAX picked up 1.5% in midday trading and the CAC 40 in Paris gained 1.3%. Britain's FTSE 100 added 0.8%.

Those gains followed a strong showing in Asia, where Hong Kong's Hang Seng jumped 3.2% to 20,590.99.

In Tokyo, the Nikkei 225 climbed 0.4% to 26,659.75. South Korea's Kospi rose 0.9% to 2,620.44.

Australia's S&P/ASX 200 added 0.3% to 7,115.50 while the Shanghai Composite index was 0.7% higher, at 3,093.70.

Markets are trying to gauge how companies and consumers are dealing with higher prices and whether central banks can help ease the problem. On Wall Street, the major indexes have been slipping since early April.

Home Depot shares jumped 3% before the market opened after the retailer reported that sales increased about 4%, pushing profits to $4.09 per share, for the quarter. That topped Wall Street's projections and the company raised its profit and sales forecast as homeowners continued to pour money into their homes, albeit at a slightly slower pace.

Walmart, on the other hand, said Tuesday that its profit took a hit even as first-quarter sales grew. The company said it is grappling with surging inflation on food and fuel and higher costs from a snarled global supply chain. Walmart tends to be more cautious about raising its prices as its budget-conscious clientele gets dinged by higher prices, especially on food and gas.

The Arkansas-based retailer also on Tuesday cut its full-year earnings forecast, sending shares down more than 6% before the opening bell.

The Federal Reserve is gradually pushing its benchmark short-term interest rate off its record low near zero, where it spent most of the pandemic. It also said it may continue to raise rates by double the usual amount at upcoming meetings. Investors are concerned that the central bank could cause a recession if it raises rates too high or too quickly.

Lingering supply chain problems continue to feed inflation, and China's recent COVID-19 lockdowns have raised concerns that they may worsen. Russia's war against Ukraine has made already high energy prices even more volatile, which could also draw out rising inflation.

U.S. crude oil prices rose 3.4% Monday and are up more than 50% for the year. Natural gas prices rose 3.8% and have more than doubled in 2022.

On Tuesday, U.S. benchmark crude oil rose $1.20 to $115.40 per barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the pricing basis for international trading, picked up $1.32 to $115.56 per barrel.

In currency trading, the dollar rose to 129.35 Japanese yen from 129.11 yen late Monday. The euro was at $1.0540, up from $1.0436.