Wall Street opens higher on tax reform talks, Yellen speech eyed
U.S. stocks opened higher on Friday ahead of Federal Reserve Chair Janet Yellen`s speech, and as concerns on tax reforms faded on news that President Donald Trump will turn his attention to the long-awaited campaign promise next week.
"Starting next week, the president`s agenda and calendar is going to revolve around tax reform," National Economic Council Director Gary Cohn told the Financial Times.
Cohn also said that despite pressure on him to both resign from and stay in his post, he was "reluctant to leave".
In the past two weeks, speculation about the departure of Cohn, along with the recent unrest in the White House, had led to investors` concerns about the Trump administration`s ability to implement its pro-growth agenda, including on tax reform.
"The thing that has the most momentum for the markets is we`re finally starting to hear substantive details about what tax reforms is going to look like," said Jamie Cox, managing partner of Harris Financial Group in Richmond, Virginia.
Investors are also awaiting Yellen`s speech at 10:00 a.m. ET (1400 GMT) as they look for clues on the future path of monetary policy.
"All eyes are around Jackson Hole. We`re likely to get some clues about when the U.S. and Europe are going to start winding down their balance sheets," Cox said.
While there are slim chances of any policy announcements, any clarity on the timing of the Fed`s unwinding of its massive bond holdings and the possibility of a third interest rate hike this year will be welcomed by investors.
Dallas Fed Chief Robert Kaplan on Friday called for patience on raising rates any further, but speed on starting the reduction of the Fed`s $4.5 trillion balance sheet.
While inflation remains stuck below the central bank`s 2-percent target, a low unemployment rate and bond yields could still argue the case for another hike. The chances of a December move is at 42.2 percent, according to CME Group`s FedWatch tool.
At 9:33 a.m. ET, the Dow Jones Industrial Average was up 60.62 points, or 0.28 percent, at 21,844.02 and the S&P 500 was up 7.62 points, or 0.31 percent, at 2,446.59.
The Nasdaq Composite was up 19.89 points, or 0.32 percent, at 6,291.22.
All the major S&P sectors were higher with financial index`s 0.56 percent leading the gainers, followed by a 0.53 percent gain in the energy index.
U.S. crude oil was up about 0.5 percent as the industry braces for Hurricane Harvey, which may become the biggest storm to hit the U.S. mainland in more than a decade.
Shares of Autodesk were up about 6.5 percent after the software maker reported a smaller-than-expected loss and raised its forecast.
Ulta Beauty sank 9.4 percent after the retailer`s comparable sales and profit forecast missed estimates.
Twitter lost about 2 percent after Jefferies downgraded the stock to "hold" from "buy."
Advancing issues outnumbered decliners on the NYSE by 2,006 to 421. On the Nasdaq, 1,505 issues rose and 577 fell.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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