U.S. Stock Indexes Hit Record Highs on AI Earnings Iran Deal

Major U.S. stock indexes surged to record highs on Tuesday, August 4, 2026, propelled by strong corporate forecasts tied to artificial intelligence and optimism over a potential diplomatic breakthrough in the Middle East. The Dow Jones Industrial Average and the S&P 500 both reached all-time highs, with the S&P 500 achieving its first record since June.

The rally was fueled by robust earnings guidance from key companies. Palantir Technologies saw its stock surge 17.4% after raising its annual revenue forecast, while industrial giant Caterpillar gained 12% after lifting its own revenue growth outlook. Analysts noted Caterpillar is benefiting directly from the AI boom, as demand for its power-generation and construction equipment is being spurred by the buildout of AI data centers. Chipmaker On Semiconductor also rose about 1% after forecasting quarterly revenue above expectations. These results reassured investors scrutinizing whether massive corporate investments in AI are translating into financial returns, following strong reports from Microsoft and Amazon last week.

Concurrently, geopolitical developments contributed to market sentiment. Crude oil prices fell more than 2%...