NEW YORK -- US stocks rallied on Tuesday as investor sentiment was lifted after the Turkish lira rebounded on Tuesday from a record low in the previous session.

The Dow Jones Industrial Average rose 112.22 points, or 0.45 percent, to 25,299.92. The S&P 500 increased 18.03 points, or 0.64 percent, to 2,839.96. The Nasdaq Composite Index climbed 51.19 points, or 0.65 percent, to 7,870.89.

The Dow's gains were led by rallying Walgreens Boots Alliance and McDonald's stocks. Shares of the companies rose 3.28 percent and 1.56 percent, respectively, at the close. All the 11 primary S&P 500 sectors closed higher. US tech giants Amazon and Apple rose about 1.2 percent and 0.4 percent, respectively, contributing to the tech-heavy Nasdaq.

The Turkish lira recovered a bit from Monday's record low in Tuesday's trading after the country's central bank pledged to provide liquidity.

A rebound of the Turkish currency eased fears about the financial crisis; however, concerns over contagion in emerging economies remained.

On the economic data, US small business optimism index climbed to 107.9 in July, marking the second highest level in the survey's 45-year history, the National Federation of Independent Business reported on Tuesday. The index measures the opinion of small businesses on the economic conditions in the country.