US open: Stocks waver amid news of State Department shake-up
Stocks are holding higher, but are off their best levels, following an in-line reading on US consumer prices and as traders digest the White House's decision to replace Secretary of State Rex Tillerson with CIA chief Mike Pompeo.
Against that backdrop, as of 1442 GMT the Dow Jones Industrial Average was ahead by 0.42% or 103.70 points at 25,280.70, alongside a 0.21% or 5.98 point advance on the S&P 500 to 2,788.57, while the Nasdaq Composite was higher by just 0.02% or 1.97 points at 7,591.39.
In parallel, the yield on the benchmark 10-year US Treasury note was off by one basis point to 2.86%, having recovered from an earlier drop to 2.83%.
From a sector standpoint, the worst performing industry groups were: Coal (3.97%), Automobiles (1.99%) and Travel&Tourism (1.61%).
America's consumer price index printed at 2.2% year-on-year for February, up from 2.1% in the month before, while core CPI came in at 1.8%, with both readings as expected.
According to economists at Barclays Research, which had expected CPI to rise by just 0.1% month-on-month at both the headline and core levels, last month's rise was the result of lingering transitory strength in core goods prices.
"That said, the report suggests a gradual firming in inflation pressures, and we view the report as consistent with our view that the Fed will raise rates in March, and three more times during the rest of the year," said Barclays Pooja Sriram in a research note sent to clients.
Earlier on Tuesday, president Donald Trump had unexpectedly ousted Tillerson, with some market commentary pointing out the multiple public scraps he had with the president himself.
Tillerson reportedly had also fallen afoul of lawmakers from both sides of the aisle given his public support for the cuts in the State Department's budget that the White House had pushed for.
In other economic news, the National Federation of Independent Business index of activity and sentiment rose to 107.6 from 106.9, beating expectations for a reading of 107.1.
"The historically high readings indicate that policy changes – lower taxes and fewer regulations - are transformative for small businesses. After years of standing on the sidelines and not benefiting from the so-called recovery, Main Street is on fire again," said NFIB president and CEO Juanita Duggan.
On the corporate front, Qualcomm slumped 5% after President Trump blocked Broadcom's hostile $140bn bid for the chip company on the grounds of national security. Trump said there is "credible evidence" that the deal "threatens to impair the national security of the US" amid concerns it would have given China the upper hand in mobile communications.
United Continental was in the black after the airline said it was targeting 2018 adjusted earnings per share of between $6.50 and $8.50 versus consensus expectations of $7.46.
Footwear retailer DSW was on the back foot,however, after its fourth-quarter revenue missed expectations.