Wall Street edges higher as focus shifts to Fed
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(Reuters) – U.S. stocks posted small gains on Tuesday as investors focused on the Federal Reserve’s policy meeting, while looking past President Donald Trump’s historic summit with North Korean leader Kim Jong Un.
The two leaders pledged to work toward complete denuclearization of the Korean peninsula, with Washington committing to providing security guarantees, but their joint statement gave few details on how the goals would be achieved.
While some of the defense stocks such as Raytheon, Lockheed Martin and Northrop Grumman fell following the summit, the broader markets saw little impact.
“Equities are really looking past the trade and geopolitical issues, and the focus is more on fundamentals,” said Terry Sandven, chief equity strategist, U.S. Bank Wealth Management in Minneapolis.
The Fed is widely expected to raise interest rates for the second time this year, when it concludes its policy meeting on Wednesday.
Investors are focused on how the U.S. central bank characterizes its monetary policy as borrowing costs return to more normal levels, while also looking for hints if it would move to raise rates three or four times this year.
Data on Tuesday showed U.S. consumer prices rose marginally in May amid a slowdown in the pace of increases in the cost of gasoline and the underlying trend continued to suggest moderate inflation in the economy.
“The macro environment remains in a Goldilocks-like zone, technical trendlines are improving and performance is becoming more broad-based, and that typically presents a favorable backdrop for stocks to trend higher.”
At 11:34 a.m. ET, the Dow Jones Industrial Average was down 7.07 points, or 0.03 percent, at 25,315.24, the S&P 500 was up 3.21 points, or 0.12 percent, at 2,785.21 and the Nasdaq Composite was up 29.07 points, or 0.38 percent, at 7,689.00.
The biggest percentage gainer on the S&P 500 was Twitter, which surged 6.1 percent after J.P. Morgan raised its price target by $11 to $50.
Tesla rose 4.6 percent after Keybanc raised its estimates for Model 3 deliveries for the second quarter and full year.
Five of the 11 major S&P sectors were lower, led by a 0.2 percent decline in the healthcare index.
Medical device maker Stryker fell 3 percent, extending losses from Monday on a report it made a takeover approach to rival Boston Scientific.
Advancing issues outnumbered decliners by a 1.24-to-1 ratio on the NYSE. Advancing issues outnumbered decliners by a 1.42-to-1 ratio on the Nasdaq.
The S&P index recorded 31 new 52-week highs and one new low, while the Nasdaq recorded 113 new highs and 16 new lows.
Reporting by Sruthi Shankar in Bengaluru; Editing by Anil D’Silva
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