Bank of America added 3.1% as the lender posted a 20% surge in second-quarter profit, and Morgan Stanley gained 4.8% after beating analysts' expectations for quarterly results.

"So far the banks have come out fairly well, which is not all that unexpected," said Robert Pavlik, senior portfolio manager at Dakota Wealth.

U.S. Federal Reserve's rapid interest rate hikes helped some of the largest U.S. banks, including JPMorgan Chase and Wells Fargo, record a profit boost that pointed towards a resilient economy.

"But we can't really assume that it's going to be the same (upbeat results) for all companies across the board," said Pavlik.

PNC Financial Services lowered its forecast for full-year net interest income (NII) on Tuesday, while brokerage Charles Schwab posted a smaller-than-expected drop in quarterly profit.

Shares of Charles Schwab jumped 13.2%, leading gains on the S&P 500, and those of PNC rose 2.6%.

Overall earnings across industries are expected to decline 8.1% for the quarter, according to Refinitiv data.

The S&P 500 banks index has fallen 3.9% so far this year, in the aftermath of a banking crisis that took down three lenders and pummeled the sector, underperforming the S&P 500 index that has notched a 17.8% gain in the same period.

In early trading on Tuesday, the banking index was up 1.1%.

Lockheed Martin added 1.1% after the weapons maker raised its annual profit and sales outlook on strong demand for military equipment, stoked by ongoing geopolitical uncertainties.

At 09:50 a.m. ET, the Dow Jones Industrial Average was up 141.63 points, or 0.41%, at 34,726.98, the S&P 500 was up 3.12 points, or 0.07%, at 4,525.91, and the Nasdaq Composite was down 43.61 points, or 0.31%, at 14,201.34.

Eight of the top 11 S&P 500 sectors advanced with industrials leading gains, while technology stocks fell 0.6%.

Wall Street rallied last week after consumer prices and producer prices data provided evidence that the economy had entered a disinflation phase, stoking hopes that the U.S. Federal Reserve will soon end its monetary policy tightening.

Meanwhile, domestic retail sales, reported on Tuesday, rose less than expected in June, though consumer spending appeared to be solid, which likely kept the economy afloat in the second quarter.

Pinterest gained 4.0% as Evercore ISI upgraded its rating on the stock to "outperform."

Advancing issues outnumbered decliners by a 2.39-to-1 ratio on the NYSE and a 1.56-to-1 ratio on the Nasdaq.

The S&P index recorded 20 new 52-week highs and no new lows, while the Nasdaq recorded 65 new highs and 33 new lows.