US stocks advanced on Tuesday as renewed strength in semiconductor shares and growing anticipation for major technology earnings boosted investor sentiment. Market participants also kept a close eye on fresh US tariffs on Canadian goods and escalating tensions in the Middle East.

The tech-heavy Nasdaq Composite climbed 1.3%, leading gains among the major US indexes. The Dow Jones Industrial Average rose more than 0.7%, while the S&P 500 added 0.9%, recovering after Monday's decline driven by geopolitical concerns surrounding the US-Iran conflict.

Semiconductor stocks continued to rebound following strong gains in Asian markets earlier in the day. Nvidia shares rose nearly 2% after the AI chipmaker announced that it had taken a stake in cloud infrastructure provider Nebius, adding further momentum to the sector's recovery.

Optimism surrounding technology stocks helped offset concerns over global trade and geopolitical risks. On Monday, US President Donald Trump announced a new round of 50% tariffs on a range of Canadian products, including beer, hockey sticks, milk, and chemicals. The tariffs are expected to take effect within 30 days after the US accused Canada of discriminatory trade practices, raising the prospect of renewed trade tensions between the two countries.

However, Canadian oil imports were exempted from the new tariffs, providing some relief to energy markets. Crude oil prices, which recently reached their highest levels since mid-June amid the US-Iran conflict, edged lower on Tuesday after Brent crude briefly climbed back above US$91 per barrel.

Investors are now turning their attention to a busy week of Big Tech earnings, with Alphabet set to report its quarterly results on Wednesday. Markets will be closely watching for updates on artificial intelligence investments and spending plans, which are expected to play a key role in shaping sentiment across the technology sector in the coming months.

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