US stock futures rebounded as a ceasefire in the Middle East held for the time being and oil prices declined. Traders are also betting that strong corporate earnings will continue to drive the market upward. S&P 500 index futures rose 0.5%, while Nasdaq 100 index futures advanced 0.8%, with both indices poised to test new record highs. In pre-market trading, processor and memory chip manufacturers were among the top gainers. Advanced Micro Devices (AMD) is scheduled to release its earnings guidance later on Tuesday, which will provide new clues on whether the artificial intelligence spending boom can be sustained. Meanwhile, the bond market found some temporary relief, with Brent crude oil prices falling 2.2% to around $112 per barrel. A major exception was the UK, where traders returned after Monday's public holiday and caught up with the global surge in yields, pushing 30-year UK government bond yields to their highest level since 1998. The US dollar remained largely stable. On Tuesday, relative calm returned to the Persian Gulf after clashes between US and Iranian forces the previous day, which also saw Tehran launch missiles and drones at the United Arab Emirates. US Defense Secretary Pete Hagesis told reporters that the United States does not "seek conflict." Meanwhile, ongoing diplomatic efforts to resolve the impasse have also provided reassurance to investors. "Earnings remain the fuel for the US stock market's rise," said Madison Faller, Global Strategist at J.P. Morgan Private Bank, in an interview. "The next question is whether this earnings strength can broaden out from the tech sector into more areas. A portfolio cannot rely on just one sector to support the entire market."
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