NEW YORK (AP) — U.S. stocks are rising Tuesday and on track to hit an all-time high after oil prices gave back some of their big recent gains.
The S&P 500 added 0.5% and was on pace to finish the day above its record set in August. The Dow Jones Industrial Average was up 185 points, or 0.4%, as of 9:35 a.m. Eastern time, and the Nasdaq composite was adding 0.6% to its own all-time high set the day before.
Stocks got a boost after the price of Brent crude oil, the international standard, dropped 2.3% to $97.97 per barrel. That’s down from nearly $110 a few weeks ago, and the easing removes some pressure from the high inflation that’s squeezing people and businesses worldwide.
It also helped relax some of the tension that’s built up in the bond market, and the yield on the 10-year Treasury fell to 5.28% from 5.31% late Monday. Yields worldwide have recently been hitting their highest levels in years or even decades, which slows the economy by making it more expensive for everyone to borrow money and by making investors less willing to pay high prices for stocks.
On Wall Street, Constellation Energy Group jumped to one of the market’s biggest gains after rising 11.5%.
It announced a long-term deal to supply Google with about as much electricity as a new nuclear reactor makes. The boom in data centers for artificial-intelligence technology has made not just electricity more in demand but also construction crews and materials throughout the economy.
Option Care Health soared 32.9% after CD&R and McKesson said they’re buying the provider of infusion services. The two are paying $32.05 for each Option Care Health share, valuing it at roughly $5.8 billion.
CDR is a private investment firm. Shares of McKesson, the healthcare services company, added 0.7%.
One of the biggest reasons the U.S. stock market has been able to rally near records despite high inflation, expensive oil and worries in the bond market is that profits for companies have remained remarkably strong.
Lamb Weston, which sells frozen fries and other potato products, said on Tuesday that its profit and revenue during its latest quarter topped its projections, for example. The results also beat analysts’ expectations, and its stock rose 7.3%.
CEO Mike Smith said the company continues to deal with unexpected increases in costs for freight and other expenses as inflation remains high. But the company nevertheless raised its forecast for an underlying measure of profit for its full fiscal year.
Expectations are high for companies across industries, as they prepare to report how much profit they made from July through September.
For companies in the S&P 500, analysts are forecasting a third straight quarter of growth above 25%, according to FactSet. Along with how high interest rates are, how much profit companies are making are the big levers that help to set prices for stocks.
In stock markets abroad, indexes ticked higher in Europe as yields continue to swing in their bond markets amid concerns about high government debts and tight budgets.
In France, tens of thousands of demonstrators marched in support of protests by students demanding more funding for schools.
In Asia, Japan’s Nikkei 225 jumped 1.1%, and Hong Kong’s Hang Seng climbed 1%, but South Korea’s Kospi dropped 0.9%.
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AP Business Writers Chan Ho-him and Matt Ott contributed to this report.
