U.S. stocks surged Tuesday, with the Dow Jones Industrial Average climbing 1,035 points, or 2%, to a record high for the second straight session, driven by strong corporate earnings and a drop in oil prices after Treasury Secretary Scott Bessent said a deal to reopen the Strait of Hormuz could come within days.
The S&P 500 rose 1.8%, reaching its first record high since June, and the Nasdaq Composite advanced 2.5%. Caterpillar was the Dow’s top performer, jumping 6%, while Palantir Technologies stock climbed 29% after CEO Alex Karp described the data-analytics company’s second-quarter results as “otherworldly.”
In an appearance on CNBC’s “Squawk Box,” Treasury Secretary Scott Bessent said “we are in talks with the Iranians” and added, “There is a chance we may have a deal today or tomorrow to open the Strait and move towards a more normalized position in this conflict.” West Texas Intermediate crude futures slid 5% to approximately $76 a barrel, while Brent crude, the global benchmark, shed 5% to settle near $79 a barrel.
Palantir stock was on track for its strongest single-session performance in over two years, according to CNBC. The company pointed to AI sovereignty as the driver of its results. Among chipmakers, Micron Technology advanced 7% and Marvell Technology surged 14%, extending a rebound that began after a rough stretch in July.
Caterpillar topped second-quarter earnings estimates and lifted its revenue growth outlook, pointing to robust orders for equipment used in AI data center projects. On tariffs, the company said full-year costs are tracking toward the bottom of the range it had previously projected.
Technology was the top-performing sector, up 4%, while financials added 1%, with Goldman Sachs among the standouts at better than 3%. Industrials and materials both posted gains of nearly 2%.
The earnings season has shown unusual breadth, with upward of 84% of S&P 500 companies topping analyst estimates among those that have already released results, according to CNBC, citing FactSet data.
The Dow had already set a record on Monday, a session in which Amazon’s market capitalization topped $3 trillion for the first time. Amazon shares slipped nearly 2% Tuesday after founder Jeff Bezos disclosed plans to sell approximately $4 billion in stock.