FX.co ★ US Stocks Hit Record Highs as Strong Earnings Fuel Rally

US stocks finished sharply higher on Tuesday, with the S&P 500 and Dow Jones both closing at new record highs. The rally was driven by strong corporate earnings and a drop in oil prices amid optimism that the US and Iran could reach an agreement to reopen the Strait of Hormuz. The S&P 500 rose 1.8% to 7,737, the Dow advanced 907 points to 54,086, and the Nasdaq 100 jumped 3.3%.

On the corporate front, Palantir surged 29%, marking its biggest single-day gain in more than two years after reporting blowout second-quarter results. Semiconductor stocks also rallied, with notable gains from Intel (+10.8%), Marvell (+13%), Micron (+7.6%), and Broadcom (+6.6%). Caterpillar added 5.5% after posting stronger-than-expected second-quarter earnings and raising its revenue growth guidance.

After the close, SpaceX reported better-than-expected second-quarter revenue in its first earnings release since its June IPO. However, the stock declined in after-hours trading as capital expenditures climbed sharply.