S&P 500 closes at record high as Nvidia nears $6 trillion milestone

The S&P 500 hit a record Tuesday as it rose for a fourth straight day, supported by rising technology stocks, hopes for a positive earnings season and a pause in oil's recent surge.

The broad-based index closed higher by 0.58%, its first record closing high since Aug. 13. The Nasdaq Composite also jumped 0.45%. It also hit a record high for the second time this week.

The S&P 500 and the Nasdaq's gains were overwhelmingly powered by gains in tech companies, such as chipmakers Marvell and Broadcom.

Nvidia, the world's largest public company, also rose and moved closer to becoming the first company to ever reach $6 trillion in market value. Other trillion-dollar tech stocks also rose Tuesday. Microsoft, Amazon, SpaceX, Meta Platforms and Tesla shares all traded in the green.

Investors are also looking forward to the start of the third quarter's earnings season, which begins in earnest next week with the country's biggest banks reporting their results.

"Heading into the start of the earnings season, analysts and companies have been more optimistic than normal in their earnings outlooks for the third quarter," said FactSet senior earnings analyst John Butters.

Artificial intelligence stocks are set to be a major contributor.

"At the stock level, AI infrastructure stocks are expected to drive more than half of S&P 500 EPS growth in Q3," analysts at Goldman Sachs said Friday. They forecast that Nvidia and chipmaker Micron would most likely be responsible for a third of the entire S&P 500's earnings growth this quarter.

Stocks got off to a strong start Tuesday thanks to a drop in oil prices. However, by the end of the trading day, energy prices were about flat. That did little to deter the rally in stocks, though.

Brent oil futures ended the day up 0.2%, at $100.58 per barrel, but that came after an earlier drop of as much as 3.3%. U.S. crude oil ended the day up just 1 cent, at $89.44 per barrel. Earlier, it was down more than 2.8%.

Oil's session was muted after Bloomberg News reported that Saudi Arabia's key cross-country pipeline was operating normally, after "multiple attacks" took the critical pipeline out of commission in early September. Saudi Aramco has not responded to multiple requests for comment.

The pipeline has been used as a Strait of Hormuz workaround, given that shipping traffic there remains at just a fraction of pre-Iran war levels.

Still, "the market remains nervous about potential supply disruptions from the region," ING commodities analysts overnight said. "This nervousness is likely to persist until there are signs of progress in a deal between the US and Iran. In the meantime, the risk of further escalation remains very real."