US stocks soared Tuesday as Treasury Secretary Scott Bessent signaled a deal with Iran is near, sending oil prices sliding, and tech futures ripped higher after “otherworldly” Palantir earnings.
The Dow Jones Industrial Average surged 1,041 points, or 2%, by about 1:20 p.m. ET while the Nasdaq jumped 2.4%.
The S&P 500 rose 1.8% to 7,736.85 — a new record.
“We are in talks with the Iranians,” Bessent told CNBC’s “Squawk Box” Tuesday morning. “There is a chance we may have a deal today or tomorrow to open the strait and move towards a more normalized position in this conflict.”
He emphasized that any deal would restore “freedom of movement” through the Strait of Hormuz, a vital maritime route for 20% of the world’s oil supplies – seemingly guaranteeing that Iran will not be allowed to charge ships for safe passage.
Brent crude oil prices fell 5.3% to $79.30 a barrel while West Texas Intermediate crude dipped 5.4% to $76.04 – and Bessent predicted prices could plunge even further as hundreds of ships stuck in the Persian Gulf start to move.
“It’s not just energy. It’s fertilizer, it’s refined products, it is the various industrial gasses,” Bessent said. “We could see a big relief trade as those prices go down.”
Shares of Palantir rallied an eye-popping 29.3% Tuesday after it reported massive earnings on strong demand for AI tools – leading tech stocks higher in the session.
CEO Alex Karp called it an “otherworldly” quarter, as the company reported 93% growth in overall revenue to $1.94 billion – including a 149% jump in commercial revenue to $764 million.
He added that the “sovereign AI revolution makes us very optimistic about the future” and predicted full-year revenue of more than $8 billion.
Meanwhile, shares of Caterpillar soared 6.5% after the equipment giant reported better-than-expected earnings and raised its annual revenue forecast on huge demand for construction equipment amid the race to build massive AI data centers.
The company also said it expects tariff costs to come in at the low end of a previously disclosed range.
Other AI-exposed stocks like Marvell Technology, Micron, Nvidia and Microsoft rose 14.4%, 7.9%, 2.3% and 1.6%, respectively.
It’s the latest in a blowout earnings season, as more than 84% of S&P 500 companies that have reported earnings have surpassed expectations, according to FactSet.
On Monday, the Dow closed at a record high while Amazon broke past a $3 trillion market cap for the first time.
Investors were awaiting SpaceX’s first quarterly earnings, scheduled for release Tuesday evening – which has traders in the options market bracing for a swing of $225 billion in the value of SpaceX shares.
SpaceX shares rose 6.6% Tuesday.