NEW YORK -- U.S. stocks climbed Tuesday, pushing the Standard & Poor's 500 to within 1 percent of its all-time closing high, as Wall Street embraced an improving economy and higher interest rates.

The tech-heavy Nasdaq composite rose 19.43 points, or 0.6 percent, to 3,504.26, lifting it above its May 21 close of 3,502.12, which was its highest finish since the year 2000.

"The market is voting itself that things are improving, with interest rates going higher without taking the stock market down," said JJ Kinahan, chief strategist with TD Ameritrade.

The S&P 500 index added 11.86 points, or 0.7 percent, to 1,652.32.

"From a technical point of view, we need to test 1,650 to go higher," Kinahan added of the level last breached three weeks ago.

The market can now make a run for the May 21 record close of 1,669.16, he added.

The benchmark indexes ran up to three-week highs as Alcoa Inc. started off earnings season, with the aluminum manufacturer the first Dow member to report earnings for the second quarter.

"Alcoa has become a little like the ceremonial first pitch of a baseball game; we're waiting for later this week for JPMorgan Chase & Co. and Wells Fargo & Co. to really start the game," Kinahan said of the banking powerhouses slated to report at the end of the week.

The market was cheered by comments from Alcoa's CEO that played down worry about the effect of a Chinese slowdown on the company's bottom line, Kinahan said.


Advertisement

Extending a winning streak that has benchmark indexes up for a fourth session, the Dow Jones industrial average climbed 75.65 points, or 0.5 percent, to 15,300.34.

Among individual stock movers, D.R. Horton Inc. jumped 7.6 percent, with shares of the home builder possibly benefiting from a report released Tuesday showing the number of foreclosures down sharply from a year ago.

Shares of FedEx rallied 4.4 percent on speculation that hedge fund Pershing Square was considering a position in the global shipping company.

Barnes & Noble Inc. rose 5.4 percent after the bookseller said its CEO had stepped down.

On the New York Mercantile Exchange, the price of oil rose to a 14-month-high of $103.53 a barrel and gold also grew costlier, with futures up 0.9 percent to finish at $1,245.90 an ounce. In the past three weeks, gold prices slid 13 percent in their most protracted decline since April, with the value of the metal down 35 percent from the record reached in the fall of 2011.

On Wednesday, the minutes of the June 18-19 Federal Open Market Committee meeting are slated to be released, and could hold clues as to when the Fed will begin reducing its bond-buying program.

"It may be September before we actually get an answer. The back-to-school spending and the housing turnover that happens in the early fall are often a good indication of the economy's health," Kinahan said.

Small-business optimism last month declined from a one-year high, the National Federation of Independent Business reported on Tuesday.