S&P 500 and Nasdaq hit records, lifted by Alphabet
Alphabet (GOOGL.O), opens new tab rose 1.6% as the Google parent's results boosted confidence that heavy investment in a race to dominate AI technology is paying off.
Shares of Microsoft (MSFT.O), opens new tab, Nvidia (NVDA.O), opens new tab and Amazon (AMZN.O), opens new tab climbed over 1%.
The U.S.-Japan trade deal and recent signs of progress in talks with the European Union also fueled Wall Street's gains.
"Investors are feeling optimistic about trade negotiations, about the economy, the trend in inflation, as well as the better-than-expected Q2 earnings reports," said Sam Stovall, chief investment strategist at CFRA Research.
Tesla (TSLA.O), opens new tab tumbled almost 9% after CEO Elon Musk warned of a "few rough quarters" as the U.S. government cuts support for electric vehicle makers. The stock has fallen about 25% so far in 2025.
UnitedHealth lost 3.7% after the insurer revealed it was cooperating with a Department of Justice probe into its Medicare practices, following reports of both criminal and civil investigations.
IBM dropped 8% after its second-quarter results fell flat with investors, hampered by disappointing sales in its core software division.
Honeywell fell 4.6% despite topping Wall Street's expectations and raising its annual outlook.
The S&P 500 was up 0.32% at 6,379.21 points.
The Nasdaq gained 0.41% to 21,106.64 points, while the Dow Jones Industrial Average was down 0.34% at 44,855.18 points, and it remained near its December 4 record high.
Seven of the 11 S&P 500 sector indexes rose, led by information technology (.SPLRCT), opens new tab, up 0.87%, followed by a 0.86% gain in communication services (.SPLRCL), opens new tab.
American Airlines (AAL.O), opens new tab tumbled almost 8% after the carrier forecast a big third-quarter loss, hurt by sluggish domestic travel demand.
U.S. President Donald Trump's global trade war has created the biggest uncertainty for the airline industry since the COVID-19 pandemic.
Markets were also monitoring Trump's planned visit to the Federal Reserve's headquarters later in the day, which follows months of the president criticizing Fed Chair Jerome Powell for interest rates the president views as too high.
With the Fed widely expected to hold rates steady at next week's meeting, traders see a 60% chance of a September rate cut, according to CME's FedWatch tool.
A fresh Labor Department report showed jobless claims last week fell to 217,000 - well below estimates - signaling continued resilience in the U.S. job market.
U.S. business activity gained momentum in July, but companies hiked prices on goods and services, fueling economists' predictions of faster inflation in the months ahead, largely driven by rising import tariffs.
Declining stocks outnumbered rising ones within the S&P 500 (.AD.SPX), opens new tab by a 1.0-to-one ratio.
The S&P 500 posted 44 new highs and 6 new lows; the Nasdaq recorded 72 new highs and 37 new lows.
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