Dow hits another record high amid Hormuz hopes

Aug. 4 (UPI) — The Dow Jones Industrial Average and the S&P 500 both hit record highs again Tuesday, as tech stocks continued to climb and oil prices dropped amid hopes that the Strait of Hormuz could soon reopen.

The Dow closed at 54,085.99, climbing 907.47 points, or 1.71%.

One reason for Tuesday’s records was a decline in oil prices spurred by Treasury Secretary Scott Bessant, who said in a CNBC interview that “we are in talks with the Iranians.”

“There is a chance we may have a deal today or tomorrow to reopen the strait and move toward a more normalized position in this conflict,” Bessant said.

Brent crude, the international oil benchmark, declined to $79.36 a barrel, a drop of 5.26%.

U.S. Secretary of State Marco Rubio also said there was “progress in talks” Tuesday between Iran and Oman to reopen the Strait of Hormuz.

The Dow was led by Caterpillar stock with a more than 5% rise. The company posted Q2 numbers that were higher than expected and has reported demand for its construction equipment for AI data centers throughout the country.

The S&P 500 closed above 7,700 for the first time Tuesday as well, hitting 7,736.52, a 1.79% increase. The Nasdaq Composite ended at 26,584.99, a 2.59% gain.

Palantir Technologies shares had their best day in more than two years, climbing more than 29.5% as the company reported “otherworldly” Q2 earnings, CNBC reported. The company said it was due to demand for AI sovereign tools.

Thierry Wizman, global FX and rates strategist at Macquarie Group, told CNBC that, “from watching the stock market zoom higher over the past three sessions, you wouldn’t think there’s anything wrong with the world.”

“After all, even the semiconductor makers have recovered from their big skid in July after some [artificial intelligence] hyperscalers managed to quell ***ysts’ fears about whether their data center investments are excessively eating into cash flow,” Wizman said. “And, so far, U.S. quarterlyearnings reports haven’t disappointed, in aggregate.”