US blue chip stocks rose on Tuesday as investors bet that the Federal Reserve would have room to lower interest rates, boosting the outlook for business investment. Shares of industrial conglomerates including 3M Co and General Electric Co gained.
But indexes pared gains and the Nasdaq was in negative territory, with disappointing results from some retailers raising concerns about consumer spending. Also, the National Association of Home Builders said US home builder confidence matched a 15-year low in May.
The Consumer Price Index last month, excluding volatile food and energy, showed the smallest 12-month increase since April 2006, the Labour Department said. Investors had worried if inflation proved stubborn, the Fed would have to raise interest rates.
The Dow Jones industrial average was up 83.54 points, or 0.63 percent, at 13,430.32. The Standard & Poor's 500 Index was up 5.18 points, or 0.34 percent, at 1,508.33. The Nasdaq Composite Index was down 4.39 points, or 0.17 percent, at 2,542.05.
The Dow hit an all-time high of 13,481.60, a steady climb that has been fuelled by stronger-than-expected profits in the first quarter, along with take-overs. The S&P 500 has enjoyed six straight weeks of gains.
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