US stock rose on Tuesday, with the Nasdaq hitting a record intraday high, led by technology companies and as robust housing market data strengthened the case for a firming economy. With the US earnings season winding down, investors are also weighing up the prospect of an interest rate hike in the coming months.
Federal Reserve Chair Janet Yellen's speech on Friday at Jackson Hole will be scrutinised for clues on the timing of a rate hike, especially after some Fed policymakers have in recent days hinted at the possibility of a hike in the near term. The meet, which includes central bankers from across the world, will start on Thursday and has traditionally been a platform for the Fed to signal the direction of monetary policy.
Expectations that the Fed will continue to keep rates low, as well as some upbeat earnings and economic news have supported the benchmark S&P 500 index's record-breaking run in the past few months. Data on Tuesday showed new US single-family home sales unexpectedly rose in July, reaching their highest level in nearly nine years as demand increased broadly, brightening the housing market outlook.
"If we continue to keep getting strong economic data it will become hard for the Fed to rationalise not hiking rates," said Erik Wytenus, global investment specialist at J.P. Morgan Private Bank in Palm Beach Florida. "We're seeing an almost eerily quite, very subdued continued melt-up environment." At 12:32 pm ET (1632 GMT) the Dow Jones industrial average was up 34.52 points, or 0.19 percent, at 18,563.94.
The S&P 500 was up 6.64 points, or 0.3 percent, at 2,189.28. The Nasdaq Composite was up 18.74 points, or 0.36 percent, at 5,263.34, after hitting an all-time intraday high of 5275.74. Eight of the 10 major S&P 500 indexes were higher, led by a 0.76 percent gain in the materials index. But the biggest boost was from the technology index's 0.52 percent gain.