US Stocks Hit New Records as Palantir and Caterpillar Lead Earnings Surge

Despite growing concerns over inflation and the ongoing war in Iran, US stocks rallied to new records on Tuesday. The S&P 500 rose by 1.8%, while the Dow Jones Industrial Average added 907 points or 1.7% to its own record set just yesterday.

The surge was driven by strong earnings reports from companies such as Palantir Technologies, which saw its revenue jump 93% in what CEO Alex Karp called an 'otherworldly' quarter. The AI company also raised its revenue forecast for the full year of 2026.

Oil prices fell 5.3% to $79.36 per barrel, easing worries about inflation and contributing to the stock market's gains. The yield on the 10-year Treasury declined to 4.62%, a notable move in the bond market that suggests investors are becoming less concerned about inflation.

The US economy remains resilient despite high inflation, with job openings at nearly 7.4 million at the end of June. Stocks abroad also rose modestly, with South Korea's Kospi climbing 1.6% due to strong demand for AI-related companies such as Samsung Electronics and SK Hynix.

Caterpillar, a heavy-equipment maker, reported stronger profit and revenue than expected, driven by increased orders for turbines used to power data centers. The company is also benefiting from the AI boom through its sales of related equipment.