Thursday's midday trade: S&P, Nasdaq higher as investors digest Yellen remarks
The S&P and the Nasdaq were slightly higher in late morning trading on Thursday as investors assessed remarks by Federal Reserve Chair Janet Yellen at a congressional testimony. The Dow, which snapped its seven-day rally on Wednesday, was little changed, weighed down by a fall in Wal-Mart. Shares of the world's largest retailer fell 4.4 percent after reporting lower-than-expected quarterly comparable sales.
Yellen said the central bank could raise interest rates "relatively soon" and was prepared to adjust its outlook as the new administration takes shape. US stocks had been on a tear since Trump's surprise victory last week, with the Dow closing at a record level four days in a row. The rally lost steam this week as investors seek clarity on Trump's campaign promises and brace for higher interest rates.
Trump's proposals to cut taxes and raise infrastructure spending are expected to boost economic activity and inflation, raising the possibility of more interest rate hikes. That sent the dollar index to a near 14-year high. Traders are pricing in an 83 percent chance of a December move, according to Thomson Reuters data. "A December rate hike is priced in. A number of Fed speakers have indicated that and they want the market to be prepared for when they do," said Erik Wytenus, global investment specialist at J.P. Morgan Private Bank.
At 11:03 am ET (1603 GMT) the Dow Jones industrial average was down 17.19 points, or 0.09 percent, at 18,850.95. The S&P 500 was up 3.93 points, or 0.18 percent, at 2,180.87. The Nasdaq Composite index was up 13.10 points, or 0.25 percent, at 5,307.69. Eight of the 11 major S&P 500 sectors were higher, with the financial index's 0.75 percent rise leading the advancers. J.P. Morgan and Bank of America were up about 1 percent, boosting the sector.
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