The CNN Money Fear and Greed index fell slightly but showed that the overall market sentiment was positive, while the index remained in the “Greed” zone on Tuesday.

U.S. stocks settled higher on Monday, with the Nasdaq Composite rising 114.19 points, or 0.42%, to 27,086.81.

In earnings, shares of Hewlett Packard Enterprise Co. ( HPE ) surged more than 28% on Monday after the server and networking products maker posted upbeat fiscal second-quarter results and raised its full-year earnings guidance. Credo Technology Group Holding Ltd.'s ( CRDO ) tanked almost 12% despite higher-than-expected quarterly earnings.

On the economic data front, U.S. ISM Manufacturing PMI rose to 54 in May from 52.7 in the previous month. The figure represented the steepest expansion in the factory sector since May 2022 and came in higher than market estimates of 53. The ISM Manufacturing New Orders rose to 56.80 points in May from 54.10 points in April.

Most sectors on the S&P 500 closed on a negative note, with utilities, consumer discretionary and real estate stocks recording the biggest losses on Monday. However, energy and information technology stocks bucked the overall market trend, closing the session higher.

Market sentiment was hit by a reescalation of Middle East tensions, after reports of Iran planning to pause peace talks with the US in response to Israel's offensive in Lebanon.

The Dow Jones closed higher by around 47 points to 51,078.88 on Monday. The S&P 500 rose 0.26% to 7,599.96, while the Nasdaq Composite climbed 0.42% at 27,086.81during Monday's session.

Investors are awaiting earnings results from Palo Alto Networks Inc. ( PANW ) , Coca-Cola Co. ( KO ) , and Dollar General Corp. ( DG ) today.

What Is CNN Business Fear & Greed Index?

At a current reading of 59, the index remained in the “Greed” zone on Tuesday.

The Fear & Greed Index is a measure of the current market sentiment. It is based on the premise that higher fear exerts pressure on stock prices, while higher greed has the opposite effect. The index is calculated based on seven equal-weighted indicators. The index ranges from 0 to 100, where 0 represents maximum fear and 100 signals maximum greediness.