Megacaps and US technology stocks rebounded on Tuesday to lift the major indexes after their sharp selloff Monday amid concerning news for US AI stocks. The wider market did not see the same buying interest and declining shares slightly outnumbered winners.

The Dow Jones industrial average firmed 0.3 percent, the S&P 500 gained 0.9 percent and the Nasdaq advanced by 2.0 percent. US bond yields rose slightly after their steep declines in Mondays flight from risk. The dollar and oil prices rose.

The tech panic generated by the advent of China's DeepSeek AI service gave way on Tuesday to a more measured view that concerns were overblown. Nvidia recovered the bulk of Monday's big drop. Other noted winners included Apple, Meta, and Microsoft, which are due to issue quarterly results Wednesday and Thursday.

Meanwhile, the market reacted to favorable earnings news from stocks including Boeing and Royal Caribbean, which rallied, while disappointing results weighed in particular on Lockheed Martin and General Motors.

Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.

Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.