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US stocks closed higher on Tuesday, supported by strong performance of technology stocks that saw almost all 11 major sectors in the S&P 500 index record impressive gains.
The recovery in the technology sector began last week after Micron Technology issued a more optimistic forecast, as well as lower-than-expected inflation data.
The situation helped the S&P 500 and Dow Jones close to the record closing levels previously reached on December 11.
Micron shares rose 4%, while the PHLX semiconductor index rose 1.1%.
Nvidia shares had the biggest impact on the increase in the S&P 500 index after the company announced plans to ship artificial intelligence (AI) chips to China before the Chinese New Year celebration in mid-February.
The Dow Jones Industrial Average rose 0.47% to 227.79 points, the S&P 500 rose 0.64% to 43.99 points, and the Nasdaq Composite rose 0.52% to 121.21 points.
According to the Stock Trader’s Almanac, since 1950 the ‘Santa Claus Rally’ has typically seen the S&P 500 gain an average of 1.3% over the last five trading days of the year and the first two days of January.
In other developments, the raw materials sector rose 1.4%, while the energy sector rose 1.1%, in line with the rise in global commodity prices.
The technology sector rose 0.4%, while the financial sector rose 1.3% to record an all-time high.
However, important economic data including third-quarter Gross Domestic Product (GDP), December consumer confidence data, and weekly jobless claims are due this week.
The data will provide a clearer picture of the state of the US economy and provide an indication of the direction of the country's monetary policy.
Trading volume on US exchanges on the day amounted to $14.57 billion, slightly lower than the average of $16.9 billion for the last 20 trading days.
