U.S. stocks rose Tuesday as blockbuster bank earnings and a cooler-than-expected inflation report boost sentiment, while a profit warning from IBM weighed on the Dow Industrials and dragged software stocks lower.

The Dow Jones Industrial Average edged up 9.63 points, or 0.02%, to 52508.27. The S&P 500 rose 28.25 points, or 0.38%, to 7543.59, while the Nasdaq Composite gained 233.83 points, or 0.90%, to 26107.01. According to preliminary data, there were 1617 advancing issues and 1090 declining issues on the NYSE.

Five of the biggest U.S. banks reported second-quarter results. Goldman Sachs' profit was up 78% from the year prior at $6.63 billion, with revenue surging 39%. JPMorgan Chase's profit soared 41% to $21.16 billion, with revenue jumps across every business line. Bank of America's profit jumped 27%, Citigroup's climbed 45% and Wells Fargo's rose 17%.

Investment banking was a bright spot across the board for the Wall Street banks. Equity trading revenue was especially strong as clients rushed to trade in a volatile, risk-on market. Goldman's equity underwriting fees more than doubled, helped significantly by the SpaceX IPO. Citigroup shares slipped 5.3% despite its strong results, after executives signaled the bank planned to invest heavily in itself during the good times. Wells Fargo shares declined 2.7%.

IBM sustained its single-worst day ever, plunging 25% after issuing a profit warning. The company said its software and infrastructure business fell short of expectations in the second quarter and that it hadn't adapted quickly enough to shifting market conditions, with customers redirecting spending from software to AI hardware and memory chips. Shares of software and IT firms including Accenture, Gartner, Workday and ServiceNow also retreated in IBM's wake.

Inflation cooled more than expected in June, with the consumer price index rising 3.5% from a year earlier, down from 4.2% in May and below economist expectations of 3.8%. One notable exception: Computer software prices rose 17.4% from a year earlier, the largest such increase on record, likely reflecting the widespread adoption of AI tools.

Fed Chairman Kevin Warsh, testifying before the House Financial Services Committee in his first Capitol Hill appearance since his confirmation, said the cooler data was "positive relative to expectations" but cautioned it was "not for cherry picking" and that he wouldn't declare "mission accomplished" on inflation.

Oil prices remained elevated as renewed fighting around the Strait of Hormuz rattled energy markets. Brent crude rose to $84.73 a barrel, up 1.7% after Iran attacked two tankers in the Persian Gulf. Confirmed traffic through the strait fell to just 10 ships Monday, according to ship-tracking firm Kpler, compared with levels in the thirties and forties early last week. President Trump walked back plans to impose a 20% fee on all cargo transiting the waterway.

Yields on U.S. Treasury bonds fell, as the 10-year yield declined 0.024 percentage point to 4.585%. The WSJ Dollar index fell 0.4%. The euro was last seen at $1.14. Gold gained 1.60% to $4061.10 per troy ounce.

Looking ahead, Warsh testifies before the Senate Banking Committee Wednesday. Johnson & Johnson, Morgan Stanley, BlackRock and United Airlines also report earnings. The producer price index for June is scheduled to be released.

Write to Anvee Bhutani at anvee.bhutani@wsj.com

(END) Dow Jones Newswires

July 14, 2026 16:41 ET (20:41 GMT)

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