New York (AFP) - Wall Street stocks rallied Tuesday on mostly good corporate earnings after a mixed session in overseas markets ahead of key central bank decisions.
Major US indices shrugged off early weakness and rose one percent or more, cheering solid results from ExxonMobil, General Motors and others.
"For the most part earnings have been interpreted as pretty good," said Steve Sosnick of Interactive Brokers."US investors are in a frame of mind to view most earnings in the best possible light."
Sosnick described the market as being in a bullish mode, in part because of expectations the Federal Reserve will soon pivot away from its ultra-aggressive posture on inflation.
"The market is assuming that the end of rate hikes is in sight," Sosnick said.
In lifting US stocks, investors looked past a survey from The Conference Board that showed greater unease about the about the short-term outlook for jobs and near-term business conditions.
Tuesday's gains came as the Fed kicked off a two-day policy meeting expected to culminate in a quarter-point interest rate hike.
A quarter-point increase in February would mark a further step down after December's half-point hike, taking the rate to 4.50-4.75 percent.
Markets will focus on Fed Chair Jerome Powell's press conference after the central bankers' meeting, watching for signals on how much further the Fed thinks it has to go in order to lower prices.
Elsewhere, the eurozone economy showed greater resilience than expected in the final months of 2022, notching weak-but-positive growth of 0.1 percent.
The figure is below the 0.3 percent growth recorded in the third quarter last year, but better than forecasts of a contraction by economists.
Analysts warned against celebrating too early, however.
"The worst scenarios for this winter have been avoided, but the economy remains sluggish" even if it did show "incredible resilience," according to ING's senior eurozone economist Bert Colijn.
The eurozone report came after the International Monetary Fund late Monday upgraded its 2023 outlook, projecting 2.9 percent growth for 2023 on surprisingly strong consumption and investment while China's lifting of zero-Covid restrictions provides another boost.
"The year ahead will still be challenging...but it could well represent a turning point with growth bottoming out and inflation declining," IMF chief economist Pierre-Olivier Gourinchas told reporters.
In particular, the IMF sees Germany and Italy avoiding recessions this year, shifting from earlier predictions, as European growth proved "more resilient than expected" despite shocks from war in Ukraine.
But London stocks took a knock after the IMF said the UK economy would contract 0.6 percent this year as inflation remains stubbornly high.
That would make Britain the worst performer among the world's advanced economies, and compared with prior guidance for 0.3-percent growth.
Key figures around 2140 GMT
New York - Dow: UP 1.1 percent at 34,086.04 (close)
New York - S&P 500: UP 1.5 percent at 4,076.60 (close)
New York - Nasdaq: UP 1.7 percent at 11,584.55 (close)
London - FTSE 100: DOWN 0.2 percent at 7,771.70 (close)
Frankfurt - DAX: FLAT at 15,128.27 (close)
Paris - CAC 40: FLAT at 7,082.42 (close)
EURO STOXX 50: UP 0.1 percent at 4,163.45 (close)
Tokyo - Nikkei 225: DOWN 0.4 percent at 27,327.11 (close)
Hong Kong - Hang Seng Index: DOWN 1.0 percent at 21,842.33 (close)
Shanghai - Composite: DOWN 0.4 percent at 3,255.67 (close)
Euro/dollar: UP at $1.0870 from $1.0851 on Monday
Pound/dollar: DOWN at $1.2322 from $1.2352
Euro/pound: UP at 88.18 pence from 87.85 pence
Dollar/yen: DOWN at 130.10 yen from 130.39 yen
West Texas Intermediate: UP 1.2 percent at $78.87 per barrel
Brent North Sea crude: DOWN 0.5 percent at $84.49 per barrel
