Stocks rose on Tuesday as market participants continued to map the Federal Reserve's potential rate cuts later this year and reacted to the latest corporate earnings reports. The Dow Jones Industrial Average rose more than 140 points, while the S&P 500 Index and Nasdaq Composite added roughly 0.2% and 0.1%, respectively.
Here's how the market settled on Tuesday:
S&P 500 Index (NYSE: SPY): +0.23% or +11.42 points to 4,954.23
Dow Jones Industrial Average (NYSE: DIA): +0.37% or +141.24 points to 38,521.36
Nasdaq Composite Index (NASDAQ: QQQ): +0.07% or +11.32 points to 15,609.00
In the News: Cleveland Federal Reserve President Loretta Mester said in prepared remarks on Tuesday that central bankers are planning a cautious approach to cutting interest rates this year, echoing other policymakers in waiting for more confidence that inflation is easing towards the Fed's target rate of 2%.
"If the economy evolves as expected, I think we will gain that confidence later this year, and then we can begin moving rates down," Mester said. "My base case is that we will do so at a gradual pace so that we can continue to manage the risks to both sides of our mandate."
On the Earnings Front: Spotify (NYSE: SPOT) reported disappointing fourth-quarter earnings on Tuesday, but issued strong forward guidance as the audio streaming platforms looks to increase its profitability. During the quarter, total monthly active users (MAUs) reached 602 million, rising 23% compared to the year-ago period. Spotify expects Q1 MAUs to total 618 million.
Eli Lilly (NYSE: LLY) shares rose on Tuesday after the drugmaker reported better-than-expected fourth-quarter earnings and issued strong full year guidance, as its weight loss drug Zepbound and diabetes treatment Mounjaro boosted profits. For the full year, Eli Lilly forecasts for adjusted earnings of $12.20 to $12.70 per share on revenue of $40.4 billion to $41.6 billion.
Palantir Technologies (NYSE: PLTR) also posted strong fourth-quarter earnings and issued full year guidance that came in-line with Wall Street expectations. In a letter to shareholders, CEO Alex Karp said that company's growth has "never been greater," as demand for large language models in the United States "continues to be unrelenting."
"Our results reflect both the strength of our software and the surging demand that we are seeing across industries and sectors for artificial intelligence platforms," Karp wrote.
In Single-Stock News: DocuSign (NASDAQ: DOCU) announced it will cut 6% of its workforce on Tuesday, effecting about 440 jobs as the company embarks on a restructuring plan to improve its "financial and operational efficiency."
"As part of the Restructuring Plan, the Company expects it will restructure and reduce its current workforce by approximately 6%, with the majority of impacted positions in the Company's Sales & Marketing organizations. The Company currently estimates that it will incur approximately $28 to $32 million in non-recurring restructuring charges in connection with the Restructuring Plan, consisting primarily of cash expenditures for employee transition, notice period and severance payments, employee benefits, and related costs as well as non-cash expenses related to vesting of share-based awards," DocuSign said in a release.
For Wednesday: Market participants will turn their attention towards earnings reports from companies including Chipotle Mexican Grill (NASDAQ: CMG), Ford (NYSE: F), Roblox (NASDAQ: RBLX), Alibaba (NYSE: BABA), Uber (NYSE: UBER), CVS Health (NYSE: CVS) and Yum! Brands (NYSE: YUM), as well as more Fedspeak.