The Nasdaq closed at 25,837, up 1.3%, while the S&P 500 gained 0.9% and the Dow added 0.7% as investors positioned for Wednesday earnings from Alphabet and Tesla.
A 31.1% expected Q2 earnings growth rate for the Magnificent 7 helped fuel the rally, while the other 493 S&P 500 companies are also forecast to post a strong 22.8% increase.
Semiconductor shares led the move higher, with the SOXX ETF up 5.5%, as investors kept focusing on AI-linked profits rather than escalating U.S.-Iran conflict.
Oil still rose with the tension: front-month WTI crude gained 2.7% to $84.68 a barrel, and the 2-year Treasury yield edged up to 4.266%.
Outside tech, 3M jumped as much as 10.7% after beating expectations and raising 2026 guidance, while Genuine Parts fell 2.7% after cutting its GAAP EPS outlook.
As of mid-July 2026, the market is experiencing a strong and bullish period, with equities showing powerful gains throughout the year. This positive momentum is expected to continue, driven mainly by the artificial intelligence (AI) revolution, which has played a pivotal role in pushing stocks higher and helping them overcome various uncertainties. The strength of the AI sector remains a key factor in the market’s performance. Despite facing complex geopolitical challenges, the market has shown remarkable resilience, achieving gains even during events like the closure of the Strait of Hormuz. Overall, AI and robust earnings are fueling optimism for the months ahead.