Dow Jumps 907 Points as Stocks Hit Record Highs
Wall Street rallied Tuesday on blowout earnings from Palantir and Caterpillar and Treasury Secretary Scott Bessent's comment that a deal to reopen the Strait of Hormuz could come within days.
U.S. stocks closed at record highs Tuesday after Treasury Secretary Scott Bessent said a deal to reopen the Strait of Hormuz could be reached within days and a wave of corporate earnings came in far stronger than analysts expected.
The S&P 500 climbed 136 points, or 1.8%, to 7,736, surpassing its previous high set on June 2. The Dow Jones Industrial Average jumped 907 points, or 1.7%, and the tech-heavy Nasdaq Composite gained 2.6%.
"I think 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," Bessent told CNBC.
"The equity rally is being driven by blowout earnings from the day's two most important reports (CAT and PLTR), positive remarks from Bessent on CNBC about the potential for a deal to reopen Hormuz arriving within the next 24-48 hours, and a JOLTS report that wasn't as hot as feared," Adam Crisafulli, head of Vital Knowledge, wrote in a note to investors. The Job Openings and Labor Turnover Survey showed hiring remains solid, with layoffs at modest levels.
Investors hoping for peace in the Middle East have been disappointed before, with President Trump and other U.S. officials previously signaling a breakthrough was at hand only for the conflict to resume.
Shares of Palantir Technologies jumped 29.3% after CEO Alex Karp said the defense tech company's revenue leaped 93% in what he called an "otherworldly" quarter. The company also raised its full-year 2026 revenue forecast. Caterpillar rose 6.5% after topping profit and revenue forecasts and posting its first quarter with more than $20 billion in sales and revenue. CEO Joe Creed said the company is seeing strong order rates and a growing backlog.
Coming into the week, S&P 500 companies were on track for nearly 50% growth in earnings per share for the spring from a year earlier, according to FactSet — the biggest jump since spring 2021.
Brent crude sank 4.9% to $79.64 a barrel. It had swung between $72 and $102 through July amid uncertainty over tanker traffic in the Persian Gulf. For the year, the Dow is up 12%, the S&P 500 13% and the Nasdaq 14%.
This article was produced with the assistance of artificial intelligence (AI), in accordance with our editorial policy.
