US stocks rallied sharply on Tuesday, with the Dow Jones Industrial Average and the S&P 500 closing at record highs as upbeat corporate earnings and a steep decline in oil prices lifted global risk sentiment.
The S&P 500 advanced 1.79% to a record 7,736.52, while the tech-heavy Nasdaq Composite surged 2.59% to 26,584.99. The Dow climbed 907.47 points, or 1.71%, to finish at an all-time high of 54,085.88.
Technology and industrial stocks led the gains, while financial shares also posted solid advances. Meanwhile, crude oil prices fell sharply after US Treasury Secretary Scott Bessent said Washington and Tehran were engaged in talks and could reach an agreement as early as Tuesday or Wednesday to reopen the Strait of Hormuz. US benchmark West Texas Intermediate (WTI) crude futures tumbled 6.4% to $75.20 a barrel.
Among individual stocks, Palantir Technologies soared 29.4% after reporting stronger-than-expected second-quarter earnings. The company posted revenue of $1.94 billion, up 93% from a year earlier, and raised its full-year revenue forecast to between $8.15 billion and $8.158 billion from its earlier guidance of $7.65 billion to $7.662 billion. Palantir attributed the robust growth to strong demand from both commercial customers and government agencies.
Caterpillar gained 5.4% after posting quarterly results that beat market expectations and raising its revenue growth outlook. The company cited healthy demand for equipment used in the expansion of artificial intelligence data centers and said full-year tariff-related costs are expected to be at the lower end of its previous guidance.
On the economic front, new orders for US manufactured goods slipped 0.3% month-on-month to $656.5 billion in June, according to data from the US Census Bureau. Separately, the Department of Labor's June Job Openings and Labor Turnover Survey (JOLTS), released on August 4, painted a mixed picture of the labour market. Job openings were largely unchanged at 7.4 million, while hiring remained steady at 5.3 million.
