Stocks soar. Why? Corporate America is still great

Here's how the Dow topped 23,000
Here's how the Dow topped 23,000

Donald Trump was elected president on a promise to make America great again. But Corporate America was already great before Trump went to Washington -- and it's arguably even greater now, despite all the uncertainty in the nation's capital.

A slew of American blue chips reported strong earnings and outlooks Tuesday morning, including Dow components Caterpillar (CAT), 3M (MMM) and United Technologies (UTX) as well as GM (GM), tool maker Stanley Black & Decker (SWK) and Big Pharma titan Eli Lilly (LLY).

The good news helped push the Dow up nearly 200 points to a new all-time high, led by a nearly 5% surge in Caterpillar and 7% pop in 3M. The S&P 500 and Nasdaq hit record highs once again as well.

The Dow is now up more than 18% this year, while the Nasdaq has gained more than 22.5%. And CNNMoney's Fear & Greed Index, a measure of seven indicators of market sentiment, is showing signs of Extreme Greed as stocks skyrocket.

The solid results also come on the heels of healthy earnings from big banks JPMorgan Chase (JPM), Citigroup (C) and Bank of America (BAC) earlier this month.

Related: IBM gets a boost from low taxes and cloud computing

And in the world of tech and telecom, IBM (IBM), Adobe (ADBE) and T-Mobile (TMUS) all wowed Wall Street with their latest financials.

What's this all mean? Despite some stinker quarterly earnings reports so far -- most notably from GE (GESLX), Whirlpool (WHR) and Hasbro (HAS) -- most American companies are still doing quite well. The bad results are the exceptions, not the rule.

Consumers are continuing to spend on new cars and phones and take out loans for mortgages. And the solid earnings aren't just an American story.

Even though there are some concerns about how inward Washington has turned under President Trump, the healthy gains in sales from China reported by Caterpillar and GM are reminding investors that America can thrive thanks to globalism.

And investors are once again starting to show signs of optimism about the Trump domestic agenda, namely the prospects for tax reform and fewer regulations on banks and health care companies.

The Federal Reserve may keep the party going as well.

Trump is expected to soon name a Fed chair, and the candidate getting the most attention -- Fed governor Jerome Powell -- would likely continue the Fed's path of gradual rate hikes set into place by current Fed chair Janet Yellen.

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