Hormuz Hopes Boost Stocks to Fresh Records
US stocks surged to fresh records on Tuesday as investors pinned their hopes on a deal to reopen the Strait of Hormuz, which could happen as soon as this week. Treasury Secretary Scott Bessent told CNBC that the US and Iran are moving towards a more normalized position amid the war.
The Dow soared over 1,000 points, while the S&P 500 advanced 2%. The Nasdaq 100 climbed nearly 3% as investors piled into tech shares, with hyperscalers like Amazon's main competitors leading the charge. Amazon itself dipped 2% after notching a $3 trillion valuation for the first time.
The recent rebound in large AI spenders may be a sign that the artificial intelligence trade is starting a 'long-overdue rebalancing', according to Bret Kenwell, a US investment and options analyst at eToro. The tech sector saw solid earnings reports from Palantir and Caterpillar, which surged 29% and 6% respectively.
Brent crude fell another 5% below the $80 mark, while West Texas Intermediate crude dropped 5% to trade around $75 a barrel. The 10-year US Treasury yield dropped 5 basis points to trade around 4.62%. Major indexes soared as traders bet on a resolution to the Strait of Hormuz situation.