The benchmark S&P 500 index has closed at a record high on the back of robust manufacturing data out of the US, eurozone and China.
The data helped US stocks carry forward the momentum of yesterday when markets were buoyed by comments from Federal Reserve chair Janet Yellen, which hinted interest rate hikes were still some time off.
At the 7am (AEDT) market close, the broad-based S&P 500 jumped 13.18 points, or 0.70%, to 1,885.52, a new record. The index's previous peak was set on March 7 at 1878.04.
Meanwhile, the Dow Jones Industrial Average had lifted 74.95 points, or 0.46%, to 16,532.61, and the tech-heavy Nasdaq Composite Index surged 69.05 points, or 1.64%, to 4,268.04.
It is the second straight day the Nasdaq has outperformed the Dow and the S&P 500 after six straight days of underperformance had investors fretting about the possible popping of a tech bubble.
Art Hogan, chief market strategist at Wunderlich Securities, said investors feel more reassured about the US economy after "better" data, including a report from the Institute for Supply Management that showed US manufacturing activity rose in March.
Investors are also heartened by comments from Fed Chair Janet Yellen on Monday that suggest no "abrupt" change to US monetary policy that has been supporting the economy, Hogan said.
Finally, while geopolitical tensions over Ukraine remain high, they have not worsened, Mr Hogan added.
Major winners included biotechnology stocks that were hammered last week, such as Celgene and Gilead Sciences.
Technology companies generally did well, including Facebook, Google and Dow member Cisco.
Nasdaq heavyweight Apple rose 0.9%.
US car giants had a mixed day. Ford Motor vaulted 4.6% higher after reporting that March sales in the US rose 3.0% from a year ago.
But General Motors continued to feel the drag from the scandal over its recall of millions of vehicles due to safety problems. Chief executive Mary Barra faced tough questioning on Tuesday before a congressional panel. GM said US sales rose 4.0% in March year-over-year; shares dipped 0.2%.
Bond prices fell. The yield on the 10-year US Treasury bond rose to 2.76% from 2.73% on Monday, while the 30-year advanced to 3.60% from 3.57%. Bond prices and yields move inversely.