Dow Rockets 700 Points as Palantir and Caterpillar Spark Record Rally

The US stock market saw significant gains on August 4, with the Dow Jones Industrial Average and S&P 500 hitting record highs. The surge was driven by strong corporate earnings from Palantir and Caterpillar, as well as optimism surrounding a potential deal to reopen the Strait of Hormuz.

Palantir Technologies led the charge, rising more than 20% after reporting better-than-expected quarterly results. This sent tech shares higher, with Micron Technology and Marvell Technology also making significant gains.

Caterpillar was another standout performer, climbing around 10%-12% as the industrial equipment maker posted record quarterly sales of over $20 billion for the first time.

The gains came despite ongoing tensions in West Asia, but were boosted by comments from US Treasury Secretary Scott Bessent that a deal to reopen the Strait of Hormuz could be reached 'today or tomorrow'. Oil prices subsequently fell, with Brent crude dropping roughly 4% to near $80 and US West Texas Intermediate crude falling about 5% to around $76.

Investors are now looking ahead to another busy day of earnings reports from companies including Advanced Micro Devices (AMD), McDonald's, Spotify, and Caterpillar. Markets will also be watching for the first quarterly earnings report from SpaceX since its June public listing.