Wall Street's frenzy around artificial intelligence helped push stocks up to their highest level in more than 15 months on Tuesday, along with stronger-than-expected profit reports from several big financial companies.

The S&P 500 rose 32.19, or 0.7%, to 4,554.98, its highest finish since early April 2022. The Dow Jones Industrial Average rallied 366.58, or 1.1%, to 34,951.93, and the Nasdaq composite climbed 108.69, or 0.8%, to 14,353.64.

Microsoft was the biggest single force pushing up the S&P 500 by far. It shook off a morning loss and rose 4% after announcing the pricing for some artificial-intelligence services. It will charge each user $30 per month for its Microsoft 365 Copilot, which Wedbush analyst Dan Ives called a "flex-the-muscles move."

Wall Street has sent a select group of stocks soaring this year in hopes that AI will drive tremendous growth in profits and herald a revolution for the global economy. Besides Microsoft's nearly 50% gain for the year, Nvidia has more than tripled.

Stocks in the financial industry also drove the market higher. Shares of Charles Schwab jumped 12.6% after reporting stronger profit and revenue for the spring than analysts expected. It was one of several big financial companies to report better results than forecast, including Bank of America and Morgan Stanley.

On the losing end was Masimo, which makes medical equipment and also runs a consumer audio business home to the Bowers & Wilkins and Denon brands. The shares tumbled 20% after it said it expects to report weaker-than-expected revenue for the spring, in part because of fewer patients at U.S. hospitals. It also said a decline in demand for audio products has moved up from the lower end to the premium and luxury end.

Wall Street's reporting season is just ramping up as companies tell investors how much profit they earned from April through June. Banks have been at the front of the parade, which JPMorgan Chase helped begin last week with a better-than-expected report. Banks can offer a unique window into the economy's strength because of how many different types of customers they serve.

"We continue to see a healthy U.S. economy that is growing at a slower pace, with a resilient job market," Bank of America Chief Executive Officer Brian Moynihan said while reporting results for the nation's second-largest bank. Its stock rose 4.4%.

PNC Financial Services Group, meanwhile, said its baseline outlook is for a mild recession to start in late 2023 or early 2024, lasting into the middle of next year. It also reported stronger profit for the latest quarter than expected, and its stock rose 2.5%.

Reports on the economy Tuesday came in mixed. One said that sales at U.S. retailers grew by less last month than economists expected, marking a slowdown from May's growth. That could indicate a tiring consumer, whose strong spending so far has been one of the main bulwarks keeping the economy out of a recession.

But economists said underlying sales trends, which exclude automobiles, gasoline and other items, were stronger than expected in June.

A separate report said U.S. industrial production contracted again last month. That was a surprise to economists, who had been forecasting a flat reading.

Altogether the data seemed to reinforce the consensus among traders that the Federal Reserve will raise its federal funds rate at its meeting next week, but that could be the final increase of this cycle.

Treasury yields bounced around following Tuesday's economic reports.

The yield on the 10-year Treasury fell to 3.79% from 3.81% late Monday. It helps set rates for mortgages and other important loans.

The two-year Treasury yield, which moves more on expectations for the Fed, inched up to 4.76% from 4.75%.

LeackStat 2023