Goldman, Lockheed results buoy Wall Street

STORY: U.S. stocks closed higher for a second straight day on Tuesday after solid quarterly results from Goldman Sachs and Lockheed Martin lessened worries of a weak earnings season.

The Dow and S&P 500 both finished more than a percent, while Nasdaq gained nearly a percent.

Phillip Toews, CEO and lead portfolio manager of Toews Asset Management, said the market was due for a rally but said there was likely more pain ahead.

"What we're seeing today is a rally based on three weeks of an absolutely brutal market before this week began. You know, we were in such oversold conditions, it's only natural that we're going to move forward here. But, you know, we're coming into a seasonably favorable time, which is November and December. However, tomorrow is the anniversary of October 19th of 1987, and that was a day when the stock market fell north of 20% in a day and traders absolutely lost their minds. So, you know, I don't think we're going to have a decline tomorrow. If we do, I don't think it's going to be severe because of what we've seen in the last couple of days. But if we can get beyond that and get into the fourth quarter, we could, I think, continue to rally. However, the major caveat is that ultimately because of valuations, because of earnings pressure, because of inflation, because of higher interest rates, we think this will turn into a bear market rally, and we think we have further to move down."

Shares of Goldman Sachs rose more than 2% after the big bank reported a smaller-than-expected drop in quarterly profit as a boost in net interest income cushioned the blow from a slowdown in investment banking.

Lockheed Martin shot up more than 8.5% after the weapons maker posted stronger-than-expected quarterly revenue and maintained its 2022 revenue view.

Stocks briefly pared gains late in the session after a report said Apple was cutting production of its iPhone 14 Plus just weeks after starting shipments, but shares rebounded, with Apple ending nearly a percent higher.

And, finally, Netflix lost ground ahead of its earnings report which came after the market close but shares soared nearly 14% in extended trading, as the streaming giant said it reversed subscriber losses and projected that its new ad-supported streaming option would help attract 4.5 million more subscribers by year's end.