The Dow Jones Industrial Average surged 450 points, or 1%, and the S&P 500 moved up 0.7%, on course for a record high close. The tech-heavy Nasdaq composite rose 0.5%. Small caps on the Russell 2000 climbed 1%.

The Dow, S&P 500, and Nasdaq rose as the stock market reacted to the U.S.-Japan trade deal and digested more earnings reports. The S&P 500 and Nasdaq hit closing records.

A trade spokesperson for the European Commission (EC), Olof Gill, noted that “the EU’s primary focus is on achieving a negotiated outcome with the US”, but noted that the EU remains ready to use its anti-coercion instruments (ACI) to fast-track retaliatory tariffs should a trade deal fall through.

The Dow Jones Industrial Average led the major indexes Tuesday. Homebuilder stocks rallied after two leaders posted positive earnings results.