The S&P 500 gained roughly 0.5%–0.7%, trading above 7,830 at its intraday peak. The Nasdaq Composite advanced about 0.6% after closing at a record Monday, while the Dow Jones Industrial Average gained around 0.4%, though it remained below its August all-time high.
The gains extend Monday’s tech rally, when Nvidia, Microsoft and other mega-cap stocks pushed the Nasdaq to another record despite unusually high bond yields.
Oil Below $100 Gives Stocks Another Boost
One of Tuesday’s biggest changes came from commodities.
Brent crude fell more than 2% to around $98 per barrel, easing fears that elevated energy prices could keep U.S. inflation higher for longer. The decline also reduced some pressure on Treasury markets after yields surged to multi-decade highs earlier this week.
The 10-year Treasury yield pulled back after reaching roughly 5.31% on Monday, a level that had created a difficult backdrop for expensive growth stocks.
Normally, higher yields make future corporate profits less valuable in today’s terms, particularly for tech stocks. Yet the Nasdaq has continued making records because earnings growth from AI-linked companies has so far outweighed that valuation pressure.
AI Earnings Are Still Driving the Rally
Investors are also positioning for another strong earnings season.
Analysts expect third-quarter S&P 500 profits to rise roughly 27% year over year, with Nvidia, Meta, Alphabet and other AI-related companies contributing a large portion of the increase.
That expectation has reinforced the AI rally, even as market leadership remains concentrated.
