S&P 500 climbs to less than 1% from new record as Tesla, Amazon rise
The S&P 500 rose 0.3 percent to 2,858.56 with energy and industrials outperforming. The Dow Jones Industrial Average gained 127 points as Caterpillar climbed more than 2 percent. The Nasdaq Composite advanced 0.4 percent as Amazon and Tesla rose.
Through Tuesday's close, the S&P 500 was just 0.5 percent away from reaching an all-time high of 2,872.87, set on Jan. 26. The Nasdaq Composite was also within 1 percent of a record high, while the Dow was more than 3.5 percent away from reaching an all-time high.
The Cboe Volatility Index (VIX), considered to be the best fear gauge in the market, fell to 10.52, its lowest level since Jan. 16, when it hit a low of 10.40.
"The earnings season has been good and that's helped investors realize there are strong fundamentals to justify the high prices," said Bruce McCain, chief investment strategist at Key Private Bank. "The other thing is people get used to worries overtime. We've had trade concerns for a while and now they don't seem as bad."
Stocks' move overseas comes as a stronger-than-expected earnings season has offset concerns over global trade. Eighty percent of the S&P 500 companies that have reported quarterly results through Friday have posted better-than-expected earnings, on pace to be the highest beat rate since FactSet began tracking the metric in 2008.
Through Friday, S&P 500 earnings are up 24 percent in the second quarter on a year-over-year basis. Some of the companies that have reported better-than-expected earnings include Apple and Amazon. Dow-component Disney and is scheduled to report earnings after the close. Disney shares rose 0.9 percent.
"I think in terms of a report card, we can give it an A," said Art Hogan, chief market strategist at B. Riley FBR. "Corporate earnings have been strong, but we've also seen strength in revenue."
"When you think about what's driving markets right now, it's a tug of war between solid U.S. fundamentals and concerns around trade," Hogan said. "When you think about trade with China, it feels like the situation is escalating. But with Mexico, Canada and the European Union, it seems like it's heading in the right direction."
Last week, China said it was ready to retaliate with tariffs on around $60 billion worth of U.S. goods, ranging from 5 percent to 25 percent; just days after the U.S. administration revealed that President Donald Trump had spoken with U.S. Trade Representative Robert Lighthizer and asked him to consider increasing the proposed levies on $200 billion worth of Chinese goods up to 25 percent, from 10 percent.
Chinese state media claimed in editorials over recent days that the Asian nation and its counter-response to America has been "restrained" and "rational," in light of the levies that have been threatened. China's state media also said late Monday that they "will not surrender" to "U.S. trade blackmail."
Shares of Tesla closed more than 10 percent higher after CEO Elon Musk said he was considering taking the company private.