Investor Optimism Rises Following Strong Retail Earnings

The CNN Money Fear and Greed index moved to the "greed" zone on Wednesday, following an increase in the Dow Jones and the S&P 500 on Tuesday.

Upbeat results and guidance from Walmart Inc. WMT and The Home Depot, Inc. HD provided a boost to markets on Tuesday. However, a decline in technology stocks weighed on the Nasdaq index.

Walmart shares gained 5.1% on Tuesday after the retailer reported upbeat quarterly results and projected a smaller decline in profit for the full year. Shares of Home Depot rose 4.1% after topping Q2 expectations.

The Dow Jones gained 0.71% points to close at 33,912.44 on Tuesday. The S&P 500 rose 0.19%, while the Nasdaq Composite fell 0.19% to settle at 13,102.55 in the previous session.

Investors are now awaiting earnings results from Target Corporation TGT and Lowe's Companies, Inc. LOW.

At a current reading of 57.0, the index moved to the "greed" zone on Wednesday, following a previous reading of 55.0.

What is CNN Business Fear & Greed Index?

The Fear & Greed Index is a measure of the current market sentiment. It is based on the premise that higher fear exerts pressure on stock prices, while higher greed has the opposite effect. The index is calculated based on seven equal-weighted indicators. The index ranges from 0 to 100, where 0 represents maximum fear and 100 signals maximum greediness.