The S&P 500 climbed to an all-time high on Tuesday on a heavy day of corporate results highlighted by well-received reports from McDonald's and Caterpillar and gains for bank shares.
The Nasdaq also managed to set a record high despite declines in Google parent Alphabet after its results. Alphabet shares ended down 2.9 percent.
Shares of McDonald's rose 4.8 percent after the fast-food chain reported strong global sales. Caterpillar shares surged 5.9 percent after the heavy equipment maker raised its full-year outlook for the second time this year.
Those stocks spurred the Dow industrials, leaving the index close to record territory.
Data showing a jump in US consumer confidence amid optimism over the labor market added to the bullish sentiment.
"It feels like people are maybe getting a little more optimistic that things are, if not improving dramatically, then at least holding pretty steady in the economy and that would be pretty good for stocks," said William Delwiche, investment strategist at Baird in Milwaukee.
The Dow Jones Industrial Average rose 100.26 points, or 0.47 percent, to 21,613.43, the S&P 500 gained 7.17 points, or 0.29 percent, to 2,477.08 and the Nasdaq Composite added 1.37 points, or 0.02 percent, to 6,412.17.
Sectors that perform better during positive economic cycles led the way, with energy , materials and financials all rising at least 1 percent.
Sharp gains in oil prices supported energy shares.
A bullish profit forecast from Citigroup boosted financials while a slightly steeper US Treasury yield curve also added to positive tone for the interest-rate sensitive group.
The future path of interest rates will be in focus on Wednesday with the expected statement from the Federal Reserve.
Tuesday's trading reflects anticipation that the Fed's statement "won't be too aggressive in terms of unwinding the balance sheet or laying out a path for more rate hikes," said Bucky Hellwig, senior vice president at BB&T Wealth Management in Birmingham, Alabama. "You have low rates, low inflation, good earnings and we're up 100 points on the Dow."
The US Senate narrowly agreed to open debate on a bill to repeal Obamacare, with investors attuned to the process in part for the implications for President Donald Trump's domestic agenda, including tax cuts.
Healthcare was the worst-performing group, falling 0.7 percent.
The market's run to record highs, including a 10.7 percent rise for the S&P 500 in 2017, has left equities relatively expensive and investors counting on earnings to justify the valuations. The S&P 500 is trading around 18 times earnings estimates for the next 12 months, well above their long-term average of 15 times.
With more than one-fourth of the S&P 500 having reported results, earnings are now expected to have climbed 9.1 percent in the second quarter, up from a projection of an 8-percent rise at the start of the month, according to Thomson Reuters I/B/E/S.
Not all earnings news was positive, as 3M Co shares dropped 5.1 percent after the diversified manufacturer's report. Eli Lilly shares dropped 3.0 percent after the drugmaker outlined a lengthy delay for its experimental rheumatoid arthritis drug.
Freeport-McMoRan Inc shares jumped 14.7 percent. Soaring metal prices and progress in a permit dispute with Indonesia buoyed the world's biggest-publicly traded copper miner.
Advancing issues outnumbered declining ones on the NYSE by a 1.62-to-1 ratio; on Nasdaq, a 1.35-to-1 ratio favored advancers.
About 6.9 billion shares changed hands in US exchanges, above the 6.1 billion daily average over the last 20 sessions.
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