Stock market today: Asian stocks track Wall Street gains ahead of earnings reports

HONG KONG (AP) — Asian benchmarks extended gains Tuesday after U.S. stocks clawed back a chunk of their losses from last week, which was the worst for the S&P 500 in more than a year, while the yen weakened further to fresh 34-year lows.

U.S. futures were mixed and oil prices rose.

Japan’s benchmark Nikkei 225 edged 0.1% higher to 37,471.73, despite the country's manufacturing activity contracting for 11 straight months while approaching the break-even point in April as PMI came in at 49.9, according to Tuesday figures from au Jibun bank. The yen weakened further with it hitting a fresh 34-year low of 154.85 early Tuesday.

The Hang Seng in Hong Kong added 1.2% to 16,715.15 while the Shanghai Composite index was down 0.6% at 3,025.76.

Australia’s S&P/ASX 200 climbed 0.4% to 7,677.40. South Korea’s Kospi dropped less than 0.1% to 2,628.14.

On Monday, the S&P 500 rose 0.9% to 5,010.60 to recover more than a quarter of last week’s rout. The Dow Jones Industrial Average added 0.7% to 38,239.98, and the Nasdaq composite jumped 1.1% to 15,451.31.

The rally was widespread, and most stocks across Wall Street rose. In the S&P 500, technology stocks led the way to bounce back from their worst week since the COVID crash of 2020.

Nvidia leaped 4.4%, and Alphabet climbed 1.4% as Treasury yields stabilized in the bond market. Last week, a jump in yields cranked up the pressure on stocks, particularly those seen as the most expensive and making their investors wait the longest for big growth.

Bank stocks were also strong following some encouraging profit reports. Truist Financial rallied 3.4% after its profit for the start of the year topped analysts’ expectations.

They helped offset a 3.4% drop for Tesla, which announced more cuts to prices over the weekend. Elon Musk’s electric vehicle company has seen its stock drop more than 40% already this year, and it will report its first-quarter results later in the day.

It’s a big week for earnings reports generally, with roughly 30% of the companies in the S&P 500 scheduled to say how much they made during the year’s first three months. That includes companies that have come to be known as part of the “Magnificent Seven,” beyond Tesla and Alphabet.

The difference in growth between the Magnificent Seven and the rest of the S&P 500 should close by the end of the year, strategists Ohsung Kwon and Savita Subramanian said in a BofA Global Research report.

Verizon Communications helped kick off this week’s reports by disclosing a drop in profit that wasn’t as bad as analysts expected. It cited price increases and other measures to support its revenue. Verizon’s stock swung from an early gain to a loss of 4.7% after it reported weaker revenue for the first quarter than expected and kept its forecast for full-year profit the same.

Even more pressure than usual is on companies broadly to deliver fatter profits and revenue. That’s because the other big factor that sets stock prices, interest rates, looks unlikely to offer much help in the near term.

Top officials at the Federal Reserve warned last week that they may need to keep interest rates high for a while in order to ensure inflation is heading down to their 2% target. That was a big letdown for financial markets, dousing hopes that had built after the Fed signaled earlier that three interest-rate cuts may come this year.

Lower rates had appeared to be on the horizon after inflation cooled sharply last year. But a string of reports this year showing inflation has remained hotter than expected has raised worries about stalled progress.

In oil trading, U.S. benchmark crude picked up 32 cents to $82.22 per barrel. Brent crude, the international standard, gained 30 cents to $87.30 per barrel.

The U.S. dollar slipped to 154.75 Japanese yen from 154.84 yen. The euro rose to $1.0656 from $1.0653.