* US job openings drop in June, hiring increases

* Palantir ( PLTR ) jumps after raising annual revenue forecast

* Caterpillar ( CAT ) rises after reporting higher Q2 profit

* Indexes up: Dow 1.88%, S&P 1.9%, Nasdaq 2.69%

(Updates to afternoon trading)

By Chuck Mikolajczak and Johann M Cherian

NEW YORK, Aug 4 (Reuters) - The S&P 500 and the Dow scaled

to fresh intraday records on Tuesday, powered by the latest

batch of earnings from AI-related companies such as Caterpillar ( CAT )

and Palantir ( PLTR ) that assuaged demand concerns, while crude prices

and Treasury yields dropped on hopes for a deal in the Iran war.

Palantir Technologies ( PLTR ) soared nearly 30% and was on

track for its biggest daily percentage gain since February 2024,

after raising its annual revenue forecast.

Caterpillar ( CAT ), seen as a bellwether for the global

industrial economy, jumped about 6% after raising its annual

revenue growth forecast, as the buildout of AI data centers has

fueled demand for its power-generation and construction

equipment.

The move in Caterpillar ( CAT ) made it the biggest boost to the Dow

Industrials, accounting for over 300 points to the upside for

the venerable average.

Investors have been closely monitoring results from

AI-linked companies this earnings season for any signs the

massive spending in the space will be justified.

OIL PRICES DROP ON IRAN DEAL HOPES

Also supporting stocks was a drop of about 5% in crude

prices after a Qatari official said efforts to secure a

diplomatic resolution to the conflict were continuing, while

U.S. Treasury Secretary Scott Bessent said a deal with Iran to

reopen the Strait of Hormuz could come within the next two days.

The drop in oil prices also dented expectations for a rate

hike from the Federal Reserve at its September meeting, causing

a retreat in U.S. Treasury yields.

"I don't sense one ounce of skepticism among investors, from

oil to interest rates to equities," said Jack Ablin, chief

investment strategist and founding partner at Cresset Capital

Management in Chicago.

"The earnings reports were certainly supportive, and that's

great news, but I'm not sure a handful of earnings reports

justifies new records in the S&P."

MAJOR AVERAGES SURGE HIGHER

The Dow Jones Industrial Average rose 998.40 points,

or 1.88%, to 54,175.70, the S&P 500 gained 144.39 points,

or 1.90%, to 7,744.97 and the Nasdaq Composite gained

697.17 points, or 2.69%, to 26,610.62.

The Dow secured its first closing high since July 6 on

Monday, while the S&P 500 on Tuesday notched its first intraday

record since July 2.

Chip stocks, also seen as beneficiaries of AI-spending,

surged. The Philadelphia Semiconductor index shot up

nearly 7% and was on track for its fourth straight daily gain

after tumbling 20.6% in July.

The S&P 500 tech sector gained 4.5% as the best performing

of the 11 major S&P sectors.

Results from corporate earnings this quarter have mostly

been robust. Of the 304 companies in the S&P 500 that have

reported second-quarter earnings as of Friday, 85.2% have beaten

estimates, versus the long-term average of 67.5%, according to

LSEG data, with every major S&P sector showing profit growth.

Elon Musk's SpaceX will release its first earnings

report since its public debut after markets close. The company's

shares jumped more than 8%.

McDonald's edged up 0.1% despite reporting disappointing

results, while Pfizer ( PFE ) gained 1.1% after reporting upbeat

quarterly results.

On the data front, job openings dropped in June, weighed

down by a sharp decline in the healthcare and social assistance

sector, but a rise in hiring and low layoffs suggested the labor

market remained stable. The data is the first in a series of

reports on the labor market this week that will culminate in

Friday's government payrolls report.

Advancing issues outnumbered decliners by a 2.11-to-1 ratio

on the NYSE and by a 2.95-to-1 ratio on the Nasdaq.

The S&P 500 posted 25 new 52-week highs and three new lows,

while the Nasdaq Composite recorded 117 new highs and 43 new

lows.