NEW YORK — The S&P 500 climbed to a record high on Tuesday as investor optimism over a potential agreement to restore shipping through the Strait of Hormuz combined with strong corporate earnings, lifting broad U.S. equities despite continued uncertainty over the geopolitical outlook.
The benchmark index closed at an all-time high after gaining 1.79%, while the Dow Jones Industrial Average also finished at a record level and the Nasdaq Composite advanced sharply, supported by technology and artificial intelligence-related shares. Reuters reported that upbeat earnings from companies including Palantir and Caterpillar added momentum to the rally.
Market sentiment was also boosted by hopes that negotiations aimed at reopening the Strait of Hormuz could reduce risks to global energy supplies. U.S. Treasury Secretary Scott Bessent said a deal could be reached within days, although no final agreement had been announced and officials cautioned that discussions remained ongoing.
Oil prices fell sharply as traders priced in the possibility of improved crude flows through the strategic waterway. Lower energy prices helped ease concerns about inflation and supported expectations that pressure on businesses and consumers could diminish if shipping disruptions are resolved.
Despite the gains, market participants continued to monitor developments in the Middle East closely, with no final accord confirmed and negotiations still subject to change. Investors also remained focused on upcoming U.S. economic data and corporate earnings for further indications of the outlook for growth and monetary policy.
