US stocks were higher on Tuesday, while oil prices fell as traders reacted to a series of solid earnings results.
The S&P 500 rose 1%, hitting a record high. The Nasdaq Composite gained 1.1% and also hit a new record high. The Dow Jones Industrial Average added 391 points, or 0.8%.
Crude oil prices fell across the board, giving stocks a boost. West Texas Intermediate crude oil terminal prices fell 4% to around $101 a barrel. Brent crude oil futures lost 3%, trading above $109 a barrel.
The US-Iran truce remains fragile amid fresh attacks in the Strait of Hormuz. However, Defense Secretary Pete Hegseth said on Tuesday that the ceasefire “certainly stands” and that “two US commercial ships, along with US destroyers, have already safely passed through the strait, showing that the way is clear”.
It comes after President Donald Trump said earlier this week that the US would “guide” stranded ships through the strait, SEEbiz reports.
Another series of better-than-expected quarterly results contributed to the stock’s momentum. In particular, shares of DuPont de Nemours rose 8% after first-quarter earnings and revenue beat expectations. Shares of US-listed Belgian brewer Anheuser-Busch InBev also rose 8% after upbeat quarterly results.
However, Palantir Technologies was the exception, with shares falling 6% even after the company’s first-quarter results beat analysts’ expectations and revenue posted the fastest growth since the company’s public market debut in 2020. It also raised its guidance for the full year.
Year to date, roughly 85% of S&P 500 firms that have reported so far have beaten expectations, according to FactSet data.
“We’ve seen incredible gains not just from mega-cap technology firms, but from the broad S&P 500 index, or even the U.S. small-cap index,” said Zachary Hill, head of portfolio management at Horizon Investments.
When you combine that with the market’s belief that both the US and Iran “want some sort of resolution to this conflict,” it explains why the market is trading at record highs, Hill continued.
“The market has largely overcome the situation with the Strait of Hormuz,” he said. “I think it would take a significant change in the facts on the ground or a really big jump in the price of oil for the market to re-engage in the argument about that conflict.”
