Strong show by Caterpillar, McDonald's has S&P at record high, Nasdaq drags

A set of strong earnings from companies, including Caterpillar and McDonald's, lifted the Dow and drove the S&P 500 to a record high, but the tech-heavy Nasdaq was dragged lower by losses in Google parent Alphabet Inc.

Shares of McDonald's surged 5 percent after the fast-food giant posted the biggest rise in sales at established restaurants globally in five years.

Caterpillar's shares rose 4.1 percent after the company reported quarterly results that smashed expectations and raised its full-year outlook for the second time this year.

However, Alphabet fell 2.6 percent, after the tech giant warned that expenses would remain high as more searches shift to mobile devices.

The S&P tech index has been the best performing sector this year and earnings from big tech companies will be closely watched to see if the rally has legs.

Amazon and Facebook, part of the high-flying "FANG" stocks, report results later this week, while Apple is due to report next week.

Earnings are expected to have climbed 8.8 percent in the second quarter, compared with an 8 percent rise estimated at the start of the month, according to Thomson Reuters I/B/E/S.
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