* Durable goods order for May falls unexpectedly
* Fed’s Williams, Dudley bat for higher interest rates
* Micron higher after brokerage ups price target
* Indexes up: Dow 0.35 pct, S&P 0.35 pct, Nasdaq 0.58 pct
(Updates to open)
By Tanya Agrawal
June 26 (Reuters) – U.S. stocks were higher in early trading
on Monday, as technology stocks rose and oil prices climbed from
last week’s seven-month lows.
Apple’s 1.1 percent rise was the biggest boost to
all the three major indexes. The S&P tech index’s 0.67
percent rise lead the gainers among the 11 major S&P 500
Adding to the sentiment was a rise in European shares,
driven by Italian banks gaining after a deal to wind up two
Oil edged up for the third straight session but gains were
capped by the relentless rise in U.S. supply and bloated global
The recent drop in oil prices has spurred concerns about low
inflation, which stubbornly remains below the Federal Reserve’s
2 percent target rate.
The central bank raised rates this month for the second time
this year and is expected to raise it again. Futures imply only
a 50 percent chance of another rate hike by December.
On Monday, San Francisco Fed President John Williams said
the Fed needs to raise rates gradually or the economy runs the
risk of overheating.
New York Fed chief William Dudley said recent narrowing of
credit spreads, record stock prices and falling bond yields
could encourage the Fed to continue tightening U.S. policy.
“The Fed policymakers had been broadly hawkish last week,
and most of them anticipate another rate hike in 2017 (most
likely in December),” said Hussein Sayed, chief market
strategist at FXTM.
“However, fixed-income markets are saying it’s over for this
year as they don’t see inflationary pressures coming anytime
soon. It’s still too far from December, but oil prices will play
a significant role on how interest rates go from here.”
At 9:39 a.m. ET (1339 GMT), the Dow Jones Industrial Average
was up 75 points, or 0.35 percent, at 21,469.76, the S&P
500 was up 8.67 points, or 0.35 percent, at 2,446.97.
The Nasdaq Composite was up 36.56 points, or 0.58
percent, at 6,301.81.
Data on Monday showed new orders for key U.S.-made capital
goods unexpectedly fell in May, with non-defense orders
excluding aircraft – a closely watched proxy for business
spending plans – dropping 0.2 percent.
Economists polled by Reuters had expected a rise of 0.3
Micron was up 3.5 percent at $32.85 after Cowen & Co
increased its price target on the chipmaker’s stock.
Arconic fell 7.1 percent to $23.69 after it was
found that the specialty metals producer knowingly supplied
flammable panels to a distributor for use at Grenfell Tower,
London, where 79 people died in a blaze last week.
Advancing issues outnumbered decliners on the NYSE by 1,869
to 677. On the Nasdaq, 1,533 issues rose and 857 fell.
(Reporting by Tanya Agrawal; Editing by Arun Koyyur)