The S&P 500 and Nasdaq ended the quarter with their biggest quarterly gains since 2020 as investors remained upbeat about economic and earnings growth even amid Middle East conflict. The Dow closed at a record high, and the Nasdaq is up 21% in the second quarter on the AI ​​boom.

The index was also higher for the day on Tuesday, with technology among the biggest sector gainers in the S&P 500. Optimism over signs of progress in efforts to bring the Iran war to a permanent halt has helped stocks recently despite continued military tensions. For the month, the S&P 500 fell 1.1%, the Dow rose 2.5%, and the Nasdaq fell 2.8%.

Iran and the US signed a memorandum of understanding on June 17 aimed at ending the four-month-old conflict. But an exchange of fire over the weekend put that agreement to the test, and a Qatari official said on Tuesday that top US envoys arriving in Doha would not hold a high-level meeting with Iran.

“We’ve had a very good first half of the year, certainly better than most expected,” said Oliver Persch, senior vice president and consultant at Wealthspire Advisors in Westport, Connecticut.

“Despite all the geopolitical stuff, the US economy is performing well and corporate earnings are strong.”

After a strong first-quarter earnings season for S&P 500 companies, investors are looking ahead to second-quarter results in the coming weeks.

According to preliminary data, the S&P 500 rose 55.97 points, or 0.75%, to close at 7,498.38 points, while the Nasdaq Composite gained 374.62 points, or 1.45%, to close at 26,194.76. The Dow Jones Industrial Average rose 116.17 points, or 0.22%, to 52,298.91.

Weakness in heavyweight technology stocks has weighed on the market in recent weeks. BofA strategists said cyclical, value-oriented sectors such as energy and financials may be better bets in the second half.

Concerns about a possible hike in interest rates have weighed on the market. Traders expect at least one rate hike by the Federal Reserve by the end of 2026, according to data compiled by LSEG.