By Stephen Culp
NEW YORK (Reuters) - Wall Street pushed higher on Tuesday as investors looked to Federal Reserve Chairman Jerome Powell's optimistic view of the U.S. economy and as solid earnings supported expectations of a strong second-quarter reporting season.
In written testimony to the Senate Banking Committee, Powell discounted trade policy risks and signalled not just that he believes the economy is doing well, but that an era of stable growth may continue, provided the Fed gets its policy decisions right.
"He’s pretty upbeat on the outlook," said Richard Franulovich, head of FX strategy at Westpac Banking Corporation in New York. "The global picture is solid. Financial conditions are very accommodative. He rattled off a long list of reasons why you should expect solid growth."
As the second-quarter earnings season shifts into high gear this week, analyst expectations have grown rosier.
Analysts now see second-quarter S&P 500 earnings growth of 21.2 percent, up from 20.7 percent on July 1. Of the 39 companies in the index that have reported so far, 84.6 percent have come in ahead of Street expectations, according to Thomson Reuters data.
"We've seen some good numbers out of some companies, providing support for the forecasts that were suggesting that we're going to see another strong earnings season," said Peter Jankovskis, co-chief investment officer at OakBrook Investments LLC in Lisle, Illinois.
In economic news, U.S. industrial production increased in June, led by a manufacturing rebound and mining gains, according to the Federal Reserve.
At 2:41 p.m. ET, the Dow Jones Industrial Average <.DJI> rose 57.13 points, or 0.23 percent, to 25,121.49, the S&P 500 <.SPX> gained 12.32 points, or 0.44 percent, to 2,810.75 and the Nasdaq Composite <.IXIC> added 51.18 points, or 0.66 percent, to 7,856.89.
The Nasdaq's advance was led by Facebook Inc
Of the 11 major sectors of the S&P 500, eight were in positive territory, with materials <.SPLRCM> and technology <.SPLRCT> seeing the strongest gains.
Johnson & Johnson
Shares of Goldman Sachs Group Inc
UnitedHealth Group Inc
Advancing issues outnumbered declining ones on the NYSE by a 1.48-to-1 ratio; on Nasdaq, a 1.49-to-1 ratio favoured advancers.
The S&P 500 posted 22 new 52-week highs and one new low; the Nasdaq Composite recorded 71 new highs and 43 new lows.
(Reporting by Stephen Culp; Editing by Lisa Shumaker)
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Updated Date: Jul 18, 2018 03:05 AM