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By Riva Gold 
   -- Alphabet shares fall after earnings; Caterpillar gains 
 
   -- European bank stocks follow bond yields higher 
 
   -- Euro jumps, dollar weaker as Fed meeting begins 

A flurry of earnings reports, higher commodity prices and a record reading on German business sentiment gave global stocks a boost on Tuesday.

The Dow Jones Industrial Average gained 120 points, or 0.6%, to 21633 shortly after the opening bell. The S&P 500 gained 0.3%, and the Nasdaq Composite fell 0.2%. A fresh round of corporate results drove moves in individual companies.

Shares of equipment giant Caterpillar gained 4.5%, among the biggest gainers in the S&P 500, after the company raised its revenue and profit outlook for the year.

Shares of General Motors added 0.1% even after the auto maker's earnings plunged 58%, while shares of Google-parent Alphabet fell 2.8% after the company late Monday posted strong ad growth but said it earned less per click.

Shares of Michael Kors Holdings fell 2.6% after the luxury-fashion company reached a deal to buy Jimmy Choo for GBP896 million ($1.17 billion). Shares of the luxury shoemaker climbed 17% in London.

Gains in the U.S. follow a strong session in Europe. The Stoxx Europe 600 rose 0.6% as the German Ifo business climate index beat analysts' expectations in July and climbed to a record high, with the institute describing the mood among companies as "euphoric."

Banks, insurance companies and miners drove most of Europe's advance, as a modest rise in government bond yields supported financial shares, since such moves tend to boost lending income. German 10-year bond yields climbed to 0.535% from 0.497% Monday, while 10-year Treasury yields rose to 2.283% from 2.253%. Yields move inversely to prices.

The euro climbed 0.5% to $1.1697, around a two-year high, after briefing reaching $1.17 earlier Tuesday. It is up over 11% against the dollar for 2017.

"A strong economy is causing a strong euro," said Peter Elston, chief investment officer at Seneca Investment Managers. While it won't help exporters, many European companies are likely to benefit from falling unemployment and stronger growth in the region, he added.

The WSJ Dollar Index, which tracks the dollar against a basket of 16 currencies, edged down 0.2%.

Some analysts said trading was likely to be muted as the Federal Reserve was set to begin its two-day policy meeting later Tuesday. Economists expect no change in interest rates at this juncture, though some have speculated the central bank could announce the start date of its balance sheet runoff.

"I think there's a relatively low ceiling on where [policy] can go unless inflation kicks in," said John Maxwell, fund manager at Ivy Investments. "We don't have signs of inflation that need to be tamed."

In commodities, rises in Chinese iron-ore futures and base-metals prices boosted shares of global mining companies. Copper futures hit their highest levels since March amid optimism about Chinese demand and possible supply challenges, and were last up 2.6% at $6,188.50 a ton.

U.S. crude oil gained 2.2% to $47.38 a barrel, as investors responded positively to a closely watched meeting of OPEC members and other big crude producers.

Earlier, Australia's S&P/ASX 200 added 0.7%, outperforming stock markets in the region, following a weak session on Monday. Major banks and mining companies advanced, while shares there drew some support from the climb in oil prices.

Indexes in Japan, Hong Kong and Taiwan were barely changed from Monday's closing levels, while South Korea's Kospi fell 0.5% from a record high, snapping an eight-day winning streak.

Nina Adam

and Ese Erheriene contributed to this article.

Write to Riva Gold at riva.gold@wsj.com

(END) Dow Jones Newswires

July 25, 2017 09:58 ET (13:58 GMT)

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