U.S. stock market reached record highs on Tuesday, propelled by a significant surge in Nvidia stock.

Nvidia's stock jump of 7.2% was driven by robust demand for AI-driven cloud services and a key cloud-infrastructure deal with Oracle.

The company has delivered three consecutive quarters of exceptional growth, cementing its status as a top GPU provider for data centers and machine learning applications.

Despite its high valuation relative to the S&P 500, Nvidia's consistent growth may justify its premium price.

Anticipation of Federal Reserve interest rate cuts contributed to the stock market's overall gains, including Nvidia's rise.

Nvidia, while not featured on The Motley Fool Stock Advisor's top 10 list, stands to gain from the sustained increase in AI demand, which is anticipated to positively affect the AI sector at large.