NEW YORK, May 5, 2026, 13:02 (EDT)
Stocks rebounded Tuesday, with the Dow Jones Industrial Average clawing back some ground lost in Monday’s slide. The Dow added 265.17 points, or 0.54%, pushing it to 49,207.07, according to Reuters market data. The S&P 500 advanced 0.80%, and the Nasdaq Composite notched a 0.93% gain. Brent crude slumped 3.47% to $110.47, easing pressure from earlier oil spikes.
Why does the rebound stand out? It comes right after the Dow plunged 1.13% to 48,941.90, a move sparked by renewed tension in the Strait of Hormuz—the key Gulf chokepoint for oil shipments. Fresh reports of conflict in the Middle East rattled risk appetite, sending the S&P 500 and Nasdaq lower as well.
Investors face a straightforward dilemma: will profits keep pace with oil holding above $100, pricier debt, and a steady stream of war-related news? “Risk-on attitude persists,” wrote Scott Wren, senior global market strategist at Wells Fargo Investment Institute, as the market seems to be shrugging off concerns about a U.S.-Iran conflict and turning its attention to earnings and capex. Reuters
Old-school industrial stocks led the Dow higher, with Caterpillar and 3M together punching in about 189 points of the index’s climb, according to MarketWatch. Since the Dow is price-weighted, stocks with heftier share prices—like these two—tend to swing the average more than cheaper names.
The positive tone stretched across the board. Wall Street’s major indexes climbed, Reuters said, with oil prices slipping even as Middle East tensions persisted. Consumer discretionary topped the leaderboard, and by early trade, nine out of eleven S&P 500 sectors were in the green.
Earnings stayed in focus. DuPont shares climbed as the industrial materials company bumped up its 2026 profit and sales outlook, crediting price hikes for absorbing extra costs linked to the war with Iran. CFO Antonella Franzen said the new full-year guidance factors in roughly 4% organic growth, with pricing moves accounting for about 1%.
The latest JOLTS numbers threw off mixed signals for traders. In March, job openings dropped by 56,000 to 6.866 million, but hiring surged—up 655,000 to 5.554 million, according to the Labor Department’s report. The Job Openings and Labor Turnover Survey, or JOLTS, covers vacancies, hires, and separations and is closely watched for stress points in the labor market.
Services numbers sent mixed signals. The Institute for Supply Management’s services PMI edged down to 53.6 in April from 54.0. That’s still above the 50 mark, pointing to ongoing growth. New orders pulled back, and the prices-paid index stuck at 70.7—cost pressures still biting.
There’s a risk that this bounce is just a temporary reprieve, not a sign that danger has passed. BlackRock Investment Institute’s Wei Li and her team cautioned that “even U.S. equities won’t be insulated” if the Strait of Hormuz stays closed. Over at Themis Trading, co-head of equity trading Joe Saluzzi acknowledged earnings have topped forecasts, but he flagged that “big issues” could still come back. Reuters
The Dow sits wedged between upbeat corporate results and a renewed oil shock. Ross Mayfield, investment strategist at Baird Private Wealth Management, told Reuters on Monday there’s “not a lot of room for error” with markets trading so close to highs, and warned that downside risk could intensify if the conflict flares up again. Reuters
Buyers are calling the shots for now. The Dow’s direction, though, could hinge less on that Tuesday bounce and more on oil’s slide, surprises in earnings, and whether the Federal Reserve finds enough breathing room to steer clear of another inflation showdown.
