The S&P 500 and Nasdaq notched record high closes on Tuesday, lifted by Intel and other AI-related stocks, as a US-Iran ceasefire held firm and investors focused on strong quarterly earnings.

Washington said on Tuesday its ceasefire with Iran was intact, allaying worries that attempts by both sides to assert control over the Strait of Hormuz would escalate hostilities.

Investors focused on AI-related companies, and chip designer AMD rallied 4 percent ahead of its quarterly report after the bell. Intel surged 13 percent after Bloomberg News reported that Apple had held exploratory discussions about enlisting the company's chipmaking services to produce the main processors for its devices.

S&P 500 companies are on track to post aggregate earnings growth of 28 percent year-over-year for the first quarter, the strongest quarterly profit growth since 2021, according to Tajinder Dhillon, head of earnings research at LSEG.

Wall Street's AI heavyweights account for much of that optimism.

"Markets are following fundamentals. Earnings are coming in pretty strong, and the expectation is that will carry forward into the rest of the year," said Tom Hainlin, an investment strategist at US Bank Wealth Management in Minneapolis.

"Business spending remains strong, whether it's on AI or other productivity tools, and consumers continue to spend," Hainlin said.

The S&P 500 climbed 0.8 percent to end the session at 7,259 points. The Nasdaq gained 1 percent to 25,326, while the Dow Jones Industrial Average rose 0.7 percent to 49,298 points.

Brent crude futures fell but still traded at US$110 a barrel.

Data on Tuesday showed US job openings dropped to 6.87 million in March, slightly above the 6.84 million estimate. That reinforced the view that labour market resilience could give the central bank room to keep interest rates higher for longer. (Reuters)



Edited by Cecil Wong