The S&P 500 and Nasdaq notched record high closes on Tuesday, lifted by Intel and other AI-related stocks, as a U.S.-Iran ceasefire held firm and investors focused on strong quarterly earnings. The TSX ended lower, weighed down by a big decline in Shopify shares following its earnings report.
Washington said on Tuesday its ceasefire with Iran was intact, allaying worries that attempts by both sides to assert control over the Strait of Hormuz would escalate hostilities.
Investors focused on AI-related companies, and chip designer AMD rallied 4% ahead of its quarterly report after the bell. In the post market, shares were up a further 4% as the company forecast quarterly revenue above expectations.
Intel surged 13% in regular trading after Bloomberg News reported that Apple had held exploratory discussions about enlisting the company’s chipmaking services to produce the main processors for its devices.
The PHLX chip index jumped 4.2% to a record high, and the index is now up 55% in 2026.
S&P 500 companies are on track to post aggregate earnings growth of 28% year-over-year for the first quarter, the strongest quarterly profit growth since 2021, according to Tajinder Dhillon, head of earnings research at LSEG.
Wall Street’s AI heavyweights account for much of that optimism.
“Markets are following fundamentals. Earnings are coming in pretty strong, and the expectation is that will carry forward into the rest of the year,” said Tom Hainlin, an investment strategist at U.S. Bank Wealth Management in Minneapolis.
“Business spending remains strong, whether it’s on AI or other productivity tools, and consumers continue to spend,” Hainlin said.
The S&P 500 climbed 0.81% to end the session at 7,259.22 points.
The Nasdaq gained 1.03% to 25,326.13 points, while the Dow Jones Industrial Average rose 0.73% to 49,298.25 points.
The Toronto Stock Exchange’s S&P/TSX composite index ended down 71.96 points, or 0.2%, at 33,566.91, adding to its declines on Friday and Monday.
Shopify’s lukewarm forecast in its earnings report Tuesday failed to stem investor worries about disruptions from artificial intelligence, sending its shares down 15.6% and overshadowing comments that its own AI efforts were driving in demand and consumer traffic.
Technology lost 4.2% in Toronto and real estate ended 0.6% lower. Colliers Group International Inc shares fell 5.6% after the real estate services firm missed first-quarter profit estimates.
Thomson Reuters reported a double-digit first-quarter revenue rise, boosted by gains in its “Big 3” business segments of legal professionals, corporates and tax, and audit and accounting. Still, its shares ended 0.8% lower.
All the other major sectors on the TSX ended higher, including energy, which added 1.4%. The price of oil settled 3.9% lower at US$102.27 a barrel, giving back much of the previous day’s advance.
The consumer discretionary sector rose 1.6% and heavily weighted financials ended 0.7% higher.
On Wall Street, all 11 S&P 500 sector indexes rise, led by materials , up 1.67%, followed by a 1.63% gain in information technology.
Data on Tuesday showed U.S. job openings dropped to 6.866 million in March, slightly above the 6.835 million estimate. That reinforced the view that labour market resilience could give the Federal Reserve room to keep interest rates higher for longer.
The Institute for Supply Management’s Non-Manufacturing Purchasing Managers’ Index for April in the U.S. came in at 53.6, narrowly missing the estimate of 53.7, according to economists polled by Reuters.
Domestically, Canada’s merchandise trade balance swung to a surprise surplus in March as elevated oil prices contributed to a jump in exports.
In other U.S. stocks, grain trader Archer-Daniels-Midland rose 3.8% after reporting better-than-expected first-quarter profit on higher margins. DuPont rallied 8.4% after the industrial materials maker lifted its annual profit forecast. Shares of Pinterest soared 6.9% after the image-sharing platform forecast second-quarter revenue above analysts’ estimates.
Advancing issues outnumbered falling ones within the S&P 500 by a 1.7-to-one ratio. The S&P 500 posted 43 new highs and 23 new lows; the Nasdaq recorded 160 new highs and 79 new lows.
Volume on U.S. exchanges was relatively light, with 16.1 billion shares traded, compared to an average of 17.7 billion shares over the previous 20 sessions.
Reuters, Globe staff