• EU leaders reach deal om 750 billion euro recovery fund
  • Crude futures jump by more than 3%
  • European stocks traded higher

U.S. stocks climbed higher on Tuesday as traders cheered a massive new stimulus package in Europe.

The Dow Jones Industrial Average rose 185.39 points to 26,866.26, while the S&P 500 climbed 19.63 points to 3,271.47 and the Nasdaq Composite Index jumped 67.61 points to 10,834.70.

The EU passed a 750 billion euro ($860 billion) stimulus package that will be used to battle the impact of COVID-19 on the euro zone.

Traders will be watching developments in Washington for progress on the next coronavirus relief bill. However, House Minority Leader Kevin McCarthy said he does not expect a new coronavirus relief bill until August. “I envision that this bill doesn’t get done by the end of July,” the California Republican said.

“I believe the stock market would benefit from news of a stimulus package coming to fruition,” said Kristina Hooper, Invesco’s chief global market strategist. “In times like this, despite a massive and rising budget deficit for the U.S., I believe big government is likely to be good news for the stock market.”

Investors have also been closely watching the ongoing strong performance of the tech sector.

“The market, particularly tech stocks, is rallying on both good news and bad news, that tells us it’s all about momentum and not about the facts,” said Michael McCarthy, chief market strategist at CMC Markets Asia Pacific. “There are concerns we could see significant pullbacks before we make further gains, but at the moment you can’t stand in front of the train that is the Nasdaq 100 Index.”

Corporate earnings continue to stream in.

“We expect robust growth-company balance sheets and low interest rates to support higher valuations for growth stocks than for value stocks in the near term,” said Ken Johnson, Wells Fargo’s investment strategy analyst.

Overnight in Asia markets finished higher, as China’s Shanghai Composite index edged up 0.2%; Japan’s Nikkei-225 rose 0.73%; and Hong Kong’s Hang Seng Exchange jumped 2.31%.

In Europe markets traded higher, as Britain’s FTSE-100 rose 0.3%, while France’s CAC-40 gained 0.48% and Germany’s DAX climbed 1.49%.

Crude oil futures rose 3.11% at $42.08 per barrel, Brent crude gained 3.14% at $44.64. Gold futures rose 1.24%.