US stocks edge higher as investors digest earnings following worst monthly performance in 2 years

• The S&P 500 rose as trading in February gets underway.
• The broad index fell by more than 5% in January, its worst performance since the start of the pandemic.

US stocks edged higher Tuesday as investors started the month of February with new earnings reports to assess while navigating through volatile conditions ahead of the Federal Reserve's expected interest rate hike next month.

UPS shares jumped after the parcel delivery service raised its quarterly dividend and beat earnings expectations and preliminary results from AMC prompted investors to push up shares of the movie-theater chain and meme stock. AT&T slipped after announcing it would slash its annual dividend following its spinoff of WarnerMedia.

The S&P 500 was modestly higher but on Monday logged a more than 5% drop through January, the worst monthly performance since March 2020 when markets were hammered as the COVID-19 pandemic was unfolding.

"The competing factors which have so far perplexed investors and ensured volatility are likely to continue for the time being," said Richard Hunter, head of markets at Interactive Investor, in a note Tuesday. "On the one hand, monetary tightening and geopolitical tensions are unnerving market participants, while at the same time the economic news is providing a recovering and robust backdrop, with corporate earnings also expected to confirm the rude health of companies on the ground."

Here's where US indexes stood at 9:30 a.m. on Tuesday:

• S&P 500: 4,515.84, up 0.01%

• Dow Jones Industrial Average: 35,152.48, up 0.06% (20.62 points)

• Nasdaq Composite: 14,245.96, up 0.01%

"Even so, the thought of less stimulus to which the market has become accustomed after years of easing is one which will take some time to process and in the meantime is leading to dislocations in pricing," Hunter wrote.

Around markets, a "violent" rally is coming for US stocks this month after the sell-off went too far, says Fundstrat's Tom Lee.

Oil prices fell. West Texas Intermediate crude lost 1.7% to $86.62 per barrel. Brent crude, the international benchmark, fell by 1.4% to $88.

Gold rose 0.4% to $1,804.20 per ounce. The 10-year yield slipped about 1 basis point to 1.781%.

Bitcoin rose 1.1% to $38,945.82.