Wall Street's major benchmarks finished modestly higher on Tuesday (Wednesday AEST), extending their record-setting run as investor enthusiasm surrounding artificial intelligence helped offset concerns over geopolitical tensions in the Middle East and uncertainty surrounding the United States economic outlook.
The Dow Jones Industrial Average gained 228.9 points, or 0.5%, to close at 51,307.8. The S&P 500 advanced 9.9 points, or 0.1%, to 7,609.9, while the Nasdaq Composite added 7.1 points, or 0.03%, to finish at 27,093.9.
Smaller companies outperformed their larger counterparts, with the Russell 2000 climbing 26.2 points, or 0.9%, to 2,932.0.
Artificial intelligence remained a dominant market theme, with strong corporate updates reinforcing confidence in ongoing investment across the sector.
Hewlett Packard Enterprise surged 19.5% after the AI server manufacturer brought forward its long-term financial targets by two years, signalling confidence in future demand.
Meanwhile, Alphabet announced plans to raise US$80 billion (A$111.4 billion) through equity offerings, including an investment commitment from Berkshire Hathaway, to support a significant expansion of its artificial intelligence infrastructure.
Despite the fundraising plans, Alphabet shares fell 3.9%.
Marvell Technology delivered one of the strongest performances of the session, soaring 32.5% after NVIDIA Chief Executive Officer Jensen Huang described the company as the next "trillion-dollar company" during the Computex conference in Taipei.
NVIDIA had previously invested $2 billion in Marvell in March, adding further weight to investor enthusiasm.
Cryptocurrency-related stocks came under pressure following a decline in bitcoin prices. The cryptocurrency fell 6%, dragging down sector-linked equities.
Coinbase Global lost 4.7%, while Strategy Inc dropped 9.2%.
Selling pressure also persisted among major U.S. exchange operators as investors assessed the implications of newly approved perpetual cryptocurrency futures contracts and the possibility that similar products could eventually be extended to equity markets.
Cboe Global Markets fell 9%, while CME Group and Intercontinental Exchange, the parent company of the New York Stock Exchange, each declined around 4%.
The concerns follow a decision by the Commodity Futures Trading Commission on Friday to clear the way for perpetual cryptocurrency futures contracts to be offered to U.S. investors through domestically regulated exchanges for the first time.
Geopolitical developments remained firmly in focus. Tehran is reportedly reviewing a fresh U.S. proposal aimed at ending the conflict and reopening the Strait of Hormuz.
At the same time, Israel continued military operations in Lebanon despite warnings from Tehran that the attacks risk undermining the fragile ceasefire currently in place.
Investors also digested comments from Cleveland Federal Reserve President Beth Hammack, who suggested that an interest rate increase could become necessary if inflationary pressures continue to intensify.
Economic data released during the session painted a mixed picture of the labour market. The Labor Department reported an unexpected increase in job openings, largely driven by volatility within the professional and business services sector.
However, hiring, layoffs and voluntary resignations all declined, indicating a slowing pace of labour market activity as businesses and workers navigate uncertainty related to Middle East tensions and inflation.
Attention is now turning to Friday's closely watched nonfarm payrolls report. Economists expect the U.S. economy to have added 85,000 jobs in May, representing a slowdown of 26.1% from the previous month.
The unemployment rate is forecast to remain unchanged at 4.3%.
Investors will also be monitoring quarterly earnings from Broadcom on Wednesday for further insight into demand trends across the AI and semiconductor sectors.
In bond markets, the yield on the benchmark 10-year US Treasury note was little changed at 4.453%, while the yield on the two-year Treasury note edged up 0.3% to 4.045%.
