US open: Dow Transports follows Industrials into record territory

Wall Street was trading on the frontfoot with some of the main market gauges trading just off their record and 52-week highs, underpinned by a dovish congressional testimony from Federal Reserve Chair Janet Yellen a day earlier.

At 1604 BST, the Dow Jones Industrial Average was higher by 0.06% to 21,545.69, while the S&P 500 was adding 0.09% to 2,445.54 with the Nasdaq ahead by 0.09% at 6,266.61.

Acting as a backdrop, Federal Reserve chief Janet Yellen was delivering her second day of testimony before a Congressional panel.

Commenting on her remarks, and on a rather critical note, strategists at Bank of America-Merrill Lynch said: "The secular backdrop of excess Debt, aging Demographics, technological Disruption continues to cap inflation and interest rates. Long-term GDP forecasts continue to fall and Wall St continues to enjoy a deflationary boom.

"The Icarus trade will exacerbate inequality (Chart 1), ultimately forcing the Fed and other central banks to pop the bubble later this year."

For its part, the widely-followed Dow Jones Transport average did notch up a fresh record high on an intraday basis at 9,739.12, mimicking the price action on the Dow Industrials the day before.

Simultaneous highs on both the Industrials and Transport averages has historically been a positive signal for US equity markets more broadly speaking.

From a sector standpoint, the best performance was being seen in: Aluminium (4.39%), Electrical components (1.60%), Paper (1.53%), Distillers (1.40%) and Cloting & Accessories (1.17%).

On Wednesday, the Dow Industrials had closed at a record high after Yellen indicated that the Fed won't be rushing to tighten monetary policy.

The main economic data point on Thursday was producer price data for June.

Factory gate inflation printed at up by 0.1% on the month while gaining 2.0% year-on-year (consensus: 1.8%).

Those figures prompted analysts at Barclays Research to tell clients: "We expect inflation pressures to remain solid, as labor markets continue to tighten and the dollar and commodity prices are broadly stable, although the softness in recent months presents some downside risks to our view.

"We view today’s PPI report as broadly consistent with our call, especially given the solid rise in the less erratic PPI personal consumption measure that excludes food, energy and trade."

Oil prices were reversing earlier weakness, with West Texas Intermediate higher by 0.89% to $45.90 a barrel on the ICE.

On the corporate front, Nvidia Corp was pushing past its record close on Wednesday following an upgrade from SunTrust.

Discount retailer Target was in the headlines too after it told investors it was now expecting a "modest increase" in fiscal second quarter same-store sales, versus analysts' forecasts calling for a decline.

Wal Mart was boosted by read-across from Target, giving the Dow a boost.

Dow Jones - Risers

Wal-Mart Stores Inc. (WMT) $75.10 1.57%
Goldman Sachs Group Inc. (GS) $229.38 0.88%
Apple Inc. (AAPL) $147.00 0.86%
Microsoft Corp. (MSFT) $71.68 0.74%
Walt Disney Co. (DIS) $105.11 0.70%
General Electric Co. (GE) $26.70 0.47%
Verizon Communications Inc. (VZ) $43.40 0.40%
American Express Co. (AXP) $85.11 0.34%
Home Depot Inc. (HD) $153.04 0.29%
JP Morgan Chase & Co. (JPM) $92.75 0.26%

Dow Jones - Fallers

McDonald's Corp. (MCD) $155.27 -0.84%
E.I. du Pont de Nemours and Co. (DD) $84.21 -0.74%
Johnson & Johnson (JNJ) $131.30 -0.70%
Merck & Co. Inc. (MRK) $62.38 -0.63%
Pfizer Inc. (PFE) $33.10 -0.36%
Procter & Gamble Co. (PG) $86.67 -0.33%
Unitedhealth Group Inc. (UNH) $186.26 -0.23%
3M Co. (MMM) $210.82 -0.23%
United Technologies Corp. (UTX) $123.51 -0.17%
Caterpillar Inc. (CAT) $108.80 -0.15%

S&P 500 - Risers

NRG Energy Inc. (NRG) $22.92 8.68%
Gap Inc. (GPS) $22.58 4.68%
T. Rowe Price Group Inc. (TROW) $79.08 4.64%
Alcoa Corporation (AA) $36.01 4.08%
Macy's Inc. (M) $22.09 4.06%
Kohls Corp. (KSS) $38.57 3.81%
AutoNation Inc. (AN) $42.64 3.70%
Target Corp. (TGT) $52.70 3.60%
O'Reilly Automotive Inc. (ORLY) $182.27 2.92%
Urban Outfitters Inc. (URBN) $18.12 2.84%

S&P 500 - Fallers

Seagate Technology Plc (STX) $37.89 -4.56%
FMC Technologies Inc. (FTI) $26.95 -2.37%
Fluor Corp. (FLR) $44.71 -1.69%
Delta Airlines Inc. (DAL) $54.57 -1.64%
First Solar Inc. (FSLR) $41.12 -1.60%
Flowserve Corp. (FLS) $45.52 -1.60%
National Oilwell Varco Inc. (NOV) $32.65 -1.51%
Vertex Pharmaceuticals Inc. (VRTX) $129.53 -1.45%
United States Steel Corp. (X) $22.53 -1.38%
Marathon Oil Corp. (MRO) $11.27 -1.36%

Nasdaq 100 - Risers

Liberty Global Plc Lilac Class A (LILA) $25.81 4.49%
Liberty Global Plc Lilac Class C (LILAK) $25.71 4.30%
O'Reilly Automotive Inc. (ORLY) $182.27 2.92%
Liberty Global plc Series A (LBTYA) $32.69 2.43%
Liberty Global plc Series C (LBTYK) $31.70 1.86%
Dollar Tree Inc (DLTR) $68.63 1.82%
Nvidia Corp. (NVDA) $164.74 1.37%
eBay Inc. (EBAY) $36.48 1.25%
Walgreens Boots Alliance, Inc. (WBA) $78.40 1.14%
Costco Wholesale Corp. (COST) $153.46 1.13%

Nasdaq 100 - Fallers

Seagate Technology Plc (STX) $37.89 -4.56%
Vertex Pharmaceuticals Inc. (VRTX) $129.53 -1.45%
Shire Plc Ads (SHPG) $162.13 -1.34%
Cerner Corp. (CERN) $65.01 -1.06%
Automatic Data Processing Inc. (ADP) $101.45 -1.02%
T-Mobile Us, Inc. (TMUS) $61.00 -0.83%
Cintas Corp. (CTAS) $126.15 -0.79%
Charter Communications Inc. (CHTR) $339.97 -0.78%
Idexx Laboratories Inc. (IDXX) $163.39 -0.75%
Citrix Systems Inc. (CTXS) $79.85 -0.73%