The S&P 500 Index (SPY) closed up +0.13% on Tuesday, while the Dow Jones Industrial Average (DIA) gained +0.45% and the Nasdaq 100 Index (QQQ) rose +0.48%.
All three major indexes recovered from early session losses to settle at new all-time highs, driven by continued enthusiasm around artificial intelligence spending.
Marvell Technology (NASDAQ: MRVL) soared more than 32% after Nvidia CEO Huang predicted the company would be the next to reach a $1 trillion valuation, more than five times its current market capitalization.
Hewlett Packard Enterprise (NYSE: HPE) surged more than 19% after delivering an outlook for annual sales that topped estimates, citing massive growth in AI-fueled demand for its servers and networking products.
US April JOLTS job openings unexpectedly rose by 731,000 to a 23-month high of 7.618 million, far exceeding expectations of a decline to 6.866 million.
Stocks initially fell amid uncertainty over when a US-Iran ceasefire could be reached and when the Strait of Hormuz could reopen, with oil prices rising sharply after AFP reported Hezbollah would not accept a “partial ceasefire” with Israel.
Iran threatened to abandon negotiations with the US on Monday over Israel’s escalation of attacks in Lebanon, while President Trump reportedly called Israeli President Netanyahu “crazy” and said he put the brakes on Israel’s plan to strike Beirut.
Cleveland Fed President Beth Hammack struck a hawkish tone, saying the Fed’s benchmark rate “may not be restrictive” and that “if recent data trends continue, it may soon be appropriate for policy to act to address the growing risk of persistently elevated inflation.”
Markets are discounting a 2% chance of a 25 basis point rate hike at the next FOMC meeting on June 16-17, with the generally favorable Q1 earnings season showing 84% of 485 reporting S&P 500 companies beating estimates.
Q1 S&P 500 earnings are projected to climb +12% year-over-year according to Bloomberg Intelligence, though stripping out the technology sector, earnings are projected to increase around +3%, the weakest in two years.
Intuit (NASDAQ: INTU) led software stocks lower, closing down more than 8% after Goldman Sachs downgraded the stock to sell from neutral with a price target of $276, while ServiceNow (NYSE: NOW) dropped more than 6%.
Chipmakers provided broad market support, with Applied Materials (NASDAQ: AMAT) and ON Semiconductor (NASDAQ: ON) closing up more than 6%, and Lam Research (NASDAQ: LRCX), Qualcomm (NASDAQ: QCOM), and KLA Corp (NASDAQ: KLAC) each gaining more than 5%.
Cisco Systems (NASDAQ: CSCO) closed up more than 5% to lead Dow gainers after unveiling its Agentic Platform Cisco Cloud Control for operating and defending IT infrastructure.
CNH Industrial (NYSE: CNH) surged more than 11% and Deere & Co (NYSE: DE) rose more than 6% after the Trump administration said it would cut tariffs on many products in the HVAC and farm equipment sectors starting June 8.
Auto parts suppliers also advanced after Canadian Prime Minister Carney said a rule requiring at least 50% US content for vehicles in the North American trade zone is under discussion, with Aptiv (NYSE: APTV) closing up more than 7%.
Cryptocurrency-exposed stocks retreated as Bitcoin sank more than 6% to a two-month low, with Strategy (NASDAQ: MSTR) dropping more than 9% and Coinbase Global (NASDAQ: COIN) falling more than 4%.
Praxis Precision Medicines (NASDAQ: PRAX) closed down more than 22% after reporting its vormatrigine drug did not meet its primary endpoint in the Phase 2/3 POWER1 study in adults with focal onset seizures.
Overseas markets settled mixed, with the Euro Stoxx 50 closing up +1.21%, China’s Shanghai Composite gaining +0.43%, and Japan’s Nikkei Stock Average closing down -0.30%.
