NEW YORK — Now investors seem to be saying: Maybe things aren't so bad after all.
Some better-than-expected retail earnings reports and the latest reading on housing drew investors back into the stock market Tuesday after the previous day's big sell-off. The indexes rose about 1 percent, led by a surge in financial and technology companies.
Investors were still wary about consumer spending and its effect on the economy but heard enough good news to fuel the comeback from the 186-point slide Monday in the Dow Jones industrials. Analysts said investors were putting things in perspective, thinking that the pullback was a bit overdone.
"The outlook for the economy doesn't change every 24 hours," said Alan Skrainka, chief market strategist at Edward Jones. "The news is always mixed, even after you've hit bottom."
Investors have battled mixed signals on the economy for several weeks; housing and manufacturing have been improving, but consumer spending is sagging.
The earnings reports Tuesday from retailers such as Target and Home Depot showed that U.S. consumers are still shy about spending, but results weren't quite as bad as analysts expected.
The Dow rose 82.60, or 0.9 percent, to 9,217.94. The Standard & Poor's 500 index gained 9.94, or 1 percent, to 989.67, while the Nasdaq composite index rose 25.08, or 1.3 percent, to 1,955.92.
Overseas markets also rebounded from steep declines Tuesday. Japan's Nikkei stock average rose 0.2 percent.
Light, sweet crude jumped $2.44 to $69.19 a barrel in New York.