US Stocks Hit Records Amid Soaring Corporate Profits and Easing Oil Prices
The US stock market has hit new records as profits for companies continue to soar and oil prices ease. The S&P 500 jumped by 1.8% on Tuesday, surpassing its previous all-time high set in June. The Dow Jones Industrial Average also reached a record, up 1.7%, while the Nasdaq composite rose 2.6%. Palantir Technologies and Caterpillar were among the companies leading the way, with strong profits for the spring exceeding analysts' expectations.
Palantir's CEO Alex Karp described their quarter as 'otherworldly', with revenue increasing by 93% and a raised forecast for full-year 2026. Caterpillar also saw significant growth, with its first-ever quarter to exceed $20 billion in sales and revenue. The company attributes this success to strong order rates and a growing backlog across its main businesses.
The AI boom is also benefiting Caterpillar through increased orders for turbines used to power data centers. This trend has been seen in other companies as well, including Amazon and Microsoft, which have reported strong results for the spring. With corporate profits up significantly, stocks are becoming less expensive relative to their prices two months ago, according to Phil Segner of the Leuthold Group.
Oil prices also played a role in the market's rally, with Brent crude falling 5.4% to $79.25 per barrel. This easing of oil prices has helped alleviate concerns about inflation and relaxed pressure on the overall economy and stock prices.