US stocks were higher in later morning trading on Tuesday, with the Dow Jones Industrial Average and the Nasdaq Composite hitting record levels and the S&P 500 coming within spitting distance of yet another all-time high. Markets have rallied sharply after Trump's election victory in November, riding on hopes that his plans including simpler regulations, higher infrastructure spending and tax cuts will boost the economy.
However, the lack of details regarding economic policies and Trump's focus on isolationist policies, including a travel ban on seven mainly Muslim nations, have also made investors cautious.
With the earnings season at its peak, stock valuations are in focus given the run-up in shares. The S&P 500 is trading at 17.7 times forward 12-month earnings, above the 10-year median of 14.7 times, according to StarMine data. Fourth-quarter earnings are estimated to have risen 8.2 percent - the best in nine quarters.
"We've been getting some back and forth between the new administration's business-friendly policies versus the disruptions economically and politically from the immigration and trade-related issues," said Jason Pride, director of investment strategy at Glenmede in Philadelphia. A report from the US Commerce Department showed trade deficit fell more than expected in December as exports rose to their highest level in more than 1-1/2 years, outpacing an increase in imports.
At 11:03 am ET (1603 GMT), the Dow Jones industrial average was up 80.77 points, or 0.4 percent, at 20,133.19. The S&P 500 was up 5.34 points, or 0.23 percent, at 2,297.9 and the Nasdaq Composite was up 22.95 points, or 0.41 percent, at 5,686.51. Seven of the 11 major S&P sectors were higher, with technology index's 0.58 percent rise and industrials' 0.56 percent gain leading the advancers. Apple's 1.3 percent rise provided the biggest boost to the S&P and the Nasdaq, while Boeing's 1.9 percent rise helped lift the Dow.