U. S. stocks rose on Tuesday as traders spent one of the busiest weeks of the corporate earnings season, keeping a close eye on the latest movements in interest rates.

The Dow Jones industrial average rose 499.51 points, or 1.45 per cent, to 34911.20. The s & p 500 rose 1.61% to 4462.21, while the Nasdaq composite index rose 2.15% to 13619.66.

Stocks have been under pressure recently, with the S & P 500 falling for two weeks in a row, but investors increased their holdings of risky assets on Tuesday. The Russell 2000 index of large and medium-sized stocks rose 2.1 per cent.

The energy market may have boosted traders on Tuesday, with oil and gas prices both falling sharply, possibly providing "some relief" for investors worried about inflation.

In our view, market sentiment and positions are too pessimistic at the moment. Although we have slightly reduced our record equity allocation, "JPMorgan Chase & Co's Marko Kolanovic said in a note to clients:" We are still bullish on the stock market and believe that there may be a rebound in the near future, especially in small cap stocks and high beta markets. "

As interest rates rose and banks reported results, bank stocks outperformed the market. On Tuesday morning, Citizens Financial reported better-than-expected first-quarter revenue and net profit, and its shares rose 6.8 per cent. JPMorgan Chase & Co's share price rose more than 2 per cent.

Some heavyweights in the technology and media industries also rose on Tuesday. Shares of Walt Disney Company and Netflix are up 3.2 per cent. Microsoft Corp and Alphabet rose 1.7 per cent and 1.8 per cent respectively. Travel stocks also performed well. Shares in American Airlines rose more than 5 per cent and United Airlines rose 4.5 per cent.

Andrew Smith, chief investment strategist at Delos Capital Advisors, said the stock market rose despite further interest rates, which could be a sign that investors should not believe Tuesday's rebound.

"I think it has a lot to do with the excellent performance of those defensive stocks, there is just a rotation in the market. But technology stocks are up so much today, and real yields are much higher, which is not normal, "Smith said.

The earnings report contributed to the volatility of stocks on Tuesday. Johnson & Johnson reported mixed quarterly results, with earnings per share exceeding expectations and revenue below analysts' expectations. However, its share price rose 3%, boosting the Dow. Lockheed Martin Corp shares fell 1.6% after the company reported mixed results.

On the data side, housing starts and construction permits were higher than expected in March. That appears to have boosted homebuilders, with D.R. Horton up 3.9%. "so far, the economic data have performed quite well, so despite rising recession fears and growing voices of slowing growth, there is still some potential momentum," said Angelo Kourkafas, an investment strategist at Edward Jones.

Traders also keep a close eye on the bond market, with 10-year treasury bonds yielding 2.94 per cent, the highest level since 2018. Expectations for the Fed to raise interest rates have risen sharply in recent months, although the Fed has said it will depend on the data when deciding how to raise rates for the full year.

Concerns about the Fed's next move have also triggered wild swings in the bond market, which seems to have put pressure on stocks in recent weeks. Brad, president of the Federal Reserve Bank of St. Louis, said recently that the Fed's actions "have reflected a considerable number of factors."