U.S. stocks advanced as investor optimism remained high, unaffected by a global bond sell-off and rising diesel prices. The Nasdaq Composite rose by 0.8%, following its record high on Monday, bolstered by strong performances from Nvidia (NVDA) and other technology stocks. The Dow Jones Industrial Average increased by 0.5%, while the S&P 500 climbed 0.7%, approaching a record close.

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Treasury yields decreased on Tuesday, with the 10-year yield at 5.29%, having recently reached its highest closing level in 24 years. The 30-year yield was at 5.66%, close to its highest since 2002. The technology sector showed continued strength, as AMD CEO Lisa Su stated that demand for compute capabilities is outpacing supply. This followed healthy earnings reported by Foxconn, a Taiwanese partner of Nvidia, indicating strong global demand for AI infrastructure.

Nvidia's market capitalization is nearing $6 trillion, drawing investor attention. On the earnings front, Constellation Brands (STZ) is scheduled to report on Tuesday, while the broader economic calendar remains relatively quiet.

The S&P 500 is increasingly reliant on a few tech stocks, with Nvidia, Apple (AAPL), and Microsoft (MSFT) making up over 21% of the index, the highest concentration ever recorded. In the 1980s, IBM, AT&T, and ExxonMobil held a similar position but only accounted for 13.4% of the index at their peak.

Constellation Energy (CEG) shares jumped 13% after Alphabet (GOOG, GOOGL) announced a $4.3 billion deal to secure 890 megawatts of nuclear energy through a 20-year purchasing agreement. This capacity will result from upgrades to existing plants in Illinois, New Jersey, and Pennsylvania, which includes modernization efforts.

Stocks initially climbed on Tuesday as the S&P 500 marked a record high shortly after the market opened. Investors maintain a bullish outlook, driven by enthusiasm for AI and strong upcoming earnings projections. Although long-term borrowing costs are near multi-decade highs, the market's resilience continues.

The $110 billion merger between Paramount Skydance (PSKY) and Warner Bros. Discovery (WBD) was finalized after a lengthy process, now uniting streaming services HBO Max and Paramount+. The merger aims to leverage the respective companies' legacy to build a next-generation global media enterprise.

First-half profits for Wall Street significantly exceeded New York City budget projections for the entirety of 2026, reportedly jumping 51% year-over-year to $49.5 billion. This figure is $4.2 billion over estimates for the entire year. The New York securities industry could potentially surpass $90 billion if this trend continues.

Despite recent gains in notable tech stocks, a lower price-to-earnings growth (PEG) ratio for the S&P 500 suggests the overall stock market could be undervalued at present.

Economic indicators for the week include the ADP weekly employment change and the trade balance figures for August. On the oil front, prices slipped slightly amid shifting supply concerns, even as Middle Eastern crude exports remained resilient despite regional tensions.