US stocks closed higher on Tuesday as optimism surrounding artificial intelligence (AI) investments and stronger-than-expected economic data helped lift investor sentiment despite ongoing uncertainty over a potential agreement between the US and Iran.
The Dow Jones Industrial Average rose 0.45%, while the S&P 500 gained 0.13% and the Nasdaq Composite edged up 0.03%, recovering from earlier losses during the trading session.
Investor confidence was boosted by fresh developments in the AI sector. AI startup Anthropic revealed it had confidentially filed for a US initial public offering, while Alphabet is reportedly seeking to raise US$80 billion to accelerate the expansion of its AI infrastructure.
The technology sector also received support after Nvidia chief executive Jensen Huang said the company has sufficient supply capacity to support continued growth in central processing units and graphics processing units, although supply constraints remain a concern.
Economic data further underpinned the market rally. US job openings rose more than expected in April, reaching their highest level in nearly two years, signalling continued strength in labour demand. The latest figures followed data showing US manufacturing activity exceeded expectations and reached a four-year high.
Meanwhile, oil prices continued to climb as investors monitored developments in the Middle East. Brent crude rose 1.1% to settle at US$96 a barrel, its highest level since May 26, amid lingering uncertainty over negotiations between Washington and Tehran.
Global equities also strengthened, with MSCI’s world stock index reaching a fresh record high, reflecting continued investor appetite for risk assets despite geopolitical tensions.
