August 4, 2026 — Updated shortly after the opening bell
U.S. stocks opened sharply higher on Tuesday, extending the previous session’s rally as strong corporate earnings, renewed enthusiasm for artificial intelligence and hopes of diplomatic progress in the Middle East boosted investor confidence.
The Dow Jones Industrial Average reached a fresh record, helped by an exceptional gain in Caterpillar. Technology stocks also advanced, with Palantir, Marvell Technology and several semiconductor-related companies among the session’s early winners.
U.S. market opening snapshot
During the first minutes of trading:
| Index | Early movement |
|---|---|
| Dow Jones Industrial Average | Approximately +1.3% |
| S&P 500 | Approximately +0.5% |
| Nasdaq Composite/Nasdaq 100 | Approximately +1.0% to +1.5% |
The S&P 500 moved closer to its record high, while the Nasdaq benefited from renewed demand for AI and semiconductor stocks. The Dow’s outperformance was largely attributable to Caterpillar because the index is weighted according to the share prices of its constituents.
Monday’s strong session had already lifted the Dow by 693 points, or 1.3%, while the S&P 500 gained 1.5% and the Nasdaq Composite advanced 2.1%.
Opening gainers
Caterpillar: approximately +12%
Caterpillar was the most important contributor to the Dow’s advance, rising approximately 12% shortly after the opening bell.
The industrial-equipment manufacturer reported higher second-quarter profit and raised its annual revenue-growth forecast. Caterpillar is also benefiting from investment in AI data centres, which is increasing demand for power-generation equipment and related infrastructure.
The company is traditionally regarded as an indicator of global industrial activity. Its strong results therefore provided support beyond the technology sector.
Because Caterpillar has one of the highest share prices in the price-weighted Dow, its advance had an unusually large influence on the index.
Palantir Technologies: approximately +17%
Palantir surged around 17% after raising its full-year revenue forecast again.
The data-analytics and artificial-intelligence company reported a 93% increase in quarterly revenue, supported by strong demand from government agencies and commercial customers. Its results reinforced confidence that spending on generative AI is producing measurable revenue growth for leading technology suppliers.
Palantir traded near $147 during the opening minutes, after briefly approaching $150.
Coherent: approximately +14%
Coherent gained approximately 14%, extending its premarket advance.
U.S. photonics companies attracted considerable buying interest following a Reuters report that the Trump administration was preparing restrictions on imports of certain Chinese data-centre components.
Investors anticipate that American optical-networking suppliers could benefit from greater domestic demand if the proposed restrictions are implemented.
Marvell Technology: approximately +12%
Marvell Technology advanced almost 12%, supported by renewed enthusiasm for AI infrastructure and data-centre networking.
The company is exposed to growing demand for specialised chips and connectivity products required by large-scale computing systems.
Snap: approximately +10%
Snap rose approximately 10% after its second-quarter revenue exceeded expectations.
The social-media company benefited from higher advertising expenditure surrounding the FIFA World Cup and stronger activity from major North American advertisers.
Lumentum: approximately +8%
Lumentum gained approximately 8% during early trading. Like Coherent, the company was supported by expectations that potential restrictions on Chinese data-centre equipment could improve opportunities for U.S.-based photonics suppliers.
AMD: approximately +4.5%
Advanced Micro Devices advanced approximately 4.5% ahead of its quarterly results, due after the closing bell.
Investors will be watching the company’s outlook for AI accelerators, data-centre processors and competition with Nvidia. Expectations are elevated following encouraging forecasts from other major AI-related businesses.
ON Semiconductor: approximately +3%
ON Semiconductor gained approximately 3% after forecasting quarterly revenue above analysts’ expectations. Its shares had risen more strongly before the opening bell before giving back part of the advance.
Opening losers
Despite the broader market rally, several companies suffered significant declines.
Bruker: approximately −17%
Bruker was among the session’s largest early losers, falling approximately 17%.
The scientific-instrument manufacturer opened near $53 after closing the previous session above $64. The magnitude of the decline made it one of the most notable negative reactions in Tuesday’s results-driven market.
Powell Industries: approximately −10%
Powell Industries declined around 10%, continuing the weakness seen in premarket trading.
The electrical-equipment company fell even as several other businesses associated with power infrastructure and data-centre construction advanced. The contrasting performance illustrated the market’s highly selective reaction to company results and outlooks.
Spotify: approximately −3.4%
Spotify lost approximately 3% despite announcing that it had reached 300 million premium subscribers.
The decline suggested that subscriber growth was insufficient to satisfy elevated investor expectations or offset concerns elsewhere in the company’s report.
McDonald’s: broadly flat after a volatile opening
McDonald’s initially traded higher but quickly surrendered most of its advance following quarterly results that received a mixed response.
The restaurant group reported modest growth in comparable U.S. sales as consumers continued to focus on value. Its shares fluctuated between approximately $262 and $274 during early trading before returning close to the previous closing level.
AI earnings restore market confidence
Artificial intelligence remains the principal driver of the rally. Strong results from Microsoft and Amazon last week had already eased concerns about the enormous sums being invested in data centres and AI infrastructure.
Palantir’s increased forecast and Caterpillar’s exposure to data-centre power demand further strengthened the view that AI expenditure is benefiting a broader group of companies, including industrial-equipment, semiconductor and optical-networking suppliers.
According to Reuters, 85.2% of the 304 S&P 500 companies that had reported second-quarter results by Friday exceeded analysts’ expectations. That compares with a long-term average of 67.5%. Reuters
Falling oil prices support sentiment
Crude-oil prices moved lower as investors assessed the possibility of progress toward an agreement involving the United States and Iran.
U.S. Treasury Secretary Scott Bessent suggested that a deal to reopen the Strait of Hormuz could potentially be reached as soon as Tuesday or Wednesday. Oil prices consequently declined, reducing immediate fears that high energy costs would intensify inflation and damage corporate margins.
Lower oil prices are generally supportive for transport companies, manufacturers and consumer-oriented businesses, although they can weigh on energy producers.
The geopolitical situation remains highly uncertain, however, and contradictory signals from Washington and Tehran could cause another rapid reversal.
Economic data and Federal Reserve expectations
Investors are also awaiting U.S. job-openings data, factory orders and trade figures. These releases will provide further evidence about the strength of the American economy.
Interest-rate expectations remain a major risk for equities. Reuters reported that futures markets assigned approximately a 63% probability to a Federal Reserve rate increase of at least 25 basis points at its next meeting.
A stronger economy may support corporate profits, but it could also encourage the Federal Reserve to maintain tighter monetary conditions. Higher bond yields would be particularly important for highly valued technology companies.
What investors should watch next
Attention will remain focused on:
- AMD’s quarterly results after the closing bell;
- the first earnings report from SpaceX since its stock-market debut;
- U.S. job-openings and factory-order data;
- developments surrounding negotiations with Iran;
- Friday’s U.S. employment report;
- the ability of the S&P 500 to establish a new record.
Market outlook
Wall Street’s strong opening reflects a favourable combination of earnings growth, renewed AI optimism and falling oil prices. Caterpillar’s results have also broadened the rally beyond traditional technology companies.
Nevertheless, the session’s large individual movements show that investor expectations remain demanding. Companies that deliver stronger forecasts are being rewarded aggressively, while disappointing results can produce immediate double-digit losses.
The market’s direction later in the session will depend on economic data, bond yields and any new developments in the Middle East.
Stock prices and percentage changes reflect early trading and may change significantly during the session. This article is provided for informational purposes only and does not constitute investment advice.
