Wall Street inches higher as Fed meeting convenes
By Stephen Culp NEW YORK (Reuters) - Wall Street gained ground on Tuesday, with investors expecting the U.S. Federal Reserve to reaffirm its dovish stance as it began its two-day monetary policy meeting.
By Stephen Culp
NEW YORK (Reuters) - Wall Street gained ground on Tuesday, with investors expecting the U.S. Federal Reserve to reaffirm its dovish stance as it began its two-day monetary policy meeting.
However, earlier gains were pared following a Bloomberg report that China is pushing back against American demands in trade negotiations.
Still, all three major U.S. stock indexes remained in the black. The Dow was set to post its fifth straight gain and the benchmark S&P 500 was about 3 percent away from its all-time high set last September.
As the Fed convened its two-day policy meeting, investors expected little change in its measured approach to interest rate hikes.
"It's an ongoing thing," said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago. "Central banks, not just in the U.S. but around the world, are backpedaling, finding new ways to back away from monetary tightening."
"That easy monetary structure is what is giving lift to stock prices," Nolte added.
Its summary of economic projections - or "dot plot" - due for release on Wednesday, will be closely scrutinized for clues regarding the extent of the central bank's patience.
But Nolte questioned whether the dot plot deserves this level of scrutiny.
"Since it has been rolled out it has been adjusted at almost every meeting," he said. "I'm not sure it's a very useful tool from a long-term perspective in determining the future direction of the Fed funds rate."
A report from the U.S. Commerce Department showed a smaller-than-expected increase in factory orders, the latest in a string of underwhelming economic data that has supported the Fed's more accommodative stance.
Still, industrials helped boost the Dow's advance, with Boeing Co gaining some altitude following a sell-off related to the March 10 crash of its 737 MAX aircraft, as analysis of black box data from the Ethiopian Airlines craft got underway.
The plane maker's shares were last up 0.7 percent.
The Dow Jones Industrial Average rose 37.01 points, or 0.14 percent, to 25,951.11, the S&P 500 gained 6.87 points, or 0.24 percent, to 2,839.81 and the Nasdaq Composite added 32.84 points, or 0.43 percent, to 7,747.31.
Of the 11 major sectors of the S&P 500, seven were in positive territory.
The consumer discretionary sector was the biggest percentage gainer, led by Amazon.com's 1.9 percent advance.
Ford Motor Co shares were up 2.0 percent after the automaker announced it would boost U.S. production of its high-profit SUVs.
Online food delivery platform Grubhub Inc dropped 6.7 percent after Keybanc warned of diminished customer spending and user retention.
Nvidia Corp rose 4.7percent on news that the company has partnered with Softbank Group Corp and LG Uplus Corp to deploy cloud gaming servers in Japan and South Korea later this year.
The chipmaker was among the top percentage gainers in the Philadelphia SE Semiconductor Index, which has jumped by nearly 22 percent so far this year.
Advancing issues outnumbered declining ones on the NYSE by a 1.10-to-1 ratio; on Nasdaq, a 1.06-to-1 ratio favoured advancers.
The S&P 500 posted 41 new 52-week highs and no new lows; the Nasdaq Composite recorded 63 new highs and 26 new lows.
(Reporting by Stephen Culp; editing by Jonathan Oatis)
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