The S&P 500 and Nasdaq closed at record highs Tuesday as investors cheered the latest batch of solid corporate earnings, including those from blue-chip Coca-Cola Co. and social-media brands such as Twitter Inc.
How did major indexes fare?
The Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA -1.69% rose 145.34 points, or 0.6%, to 26,656.39, less than 1% away from its record. The S&P 500 index /zigman2/quotes/210599714/realtime SPX -1.51% added 25.71 points, or 0.9%, to 2,933.68, and the Nasdaq Composite /zigman2/quotes/210598365/realtime COMP -1.53% gained 105.56 points, or 1.3%, to 8,120.82.
What drove the market?
Earnings continued to dominate the market, with several Dow components such as Coca-Cola /zigman2/quotes/209159848/composite KO -0.27% , Procter & Gamble Co. /zigman2/quotes/202894679/composite PG +0.59% , United Technologies Corp . and Verizon Communications Inc . /zigman2/quotes/204980236/composite VZ -1.00% releasing quarterly results.
Shares of United Technologies rose 2.3% to lead the Dow higher after the company reported earnings and revenue that beat analyst expectations, while raising expectations for its full-year performance. Shares of Coke also boosted the blue-chip index, rising 1.7%, on better-than-expected earnings.
Twitter Inc. /zigman2/quotes/203180645/composite TWTR +0.30% shares led the S&P 500’s charge into record territory, up 16% after the social media company reported user growth well beyond analyst forecasts.
On the economic front, new-home sales in March rose 4.5% to a seasonally adjusted annual rate of 692,000, the Commerce Department said.
On Monday, the energy sector had taken center stage after the U.S. said it was ending sanction waivers on imports of Iranian oil, granted to a number of countries, including China, India and Turkey, which were slated to terminate May 2. Because the tightened restrictions would remove nearly 1 million barrels of Iranian supplies from the market a day, it delivered a jolt to oil-pegged assets and produced sharp gains in the energy sector, as reflected in exchange-traded funds Energy Select Sector SPDR ETF /zigman2/quotes/206420077/composite XLE -1.06% and United States Oil Fund LP /zigman2/quotes/203483736/composite USO +15.46% .
What were analysts saying?
Potential new closing highs “are being driven by some really solid earnings reports today,” said Lindsey Bell, investment strategist with CFRA research.
For markets to keep hitting new highs, “You’re going to need to see tech really participate, following on Twitter this morning,” she added.
Bell pointed to Microsoft Corp . /zigman2/quotes/207732364/composite MSFT -0.92% and Facebook Inc . /zigman2/quotes/205064656/composite FB -2.53% as two companies that report earnings Wednesday, and whose results could go a long way in determining the stamina of the current rally.
“Overall, the [corporate] results indicate an improving world economy, particularly for big-ticket items on both the consumer and industrial spending sides, supporting investor interest in cyclical sectors like Consumer Discretionary, Industrials, Communications, and Technology,” wrote Colin Cieszynski, chief market strategist at SIA Wealth Management in a Tuesday research note.