US open: Stocks push higher on Fischer comments, deal news

US stocks pushed higher in early trade, boosted by deal news and comments from Federal Reserve member Stanley Fischer.

At 1528 BST, the Dow Jones Industrial Average and the Nasdaq were up 1.1%, while the S&P 500 was 1% firmer.

Speaking on Bloomberg TV, Federal Reserve Vice Chairman Stanley Fischer appeared to signal that the central bank may not lift interest rates until inflation returns to normal levels. Fischer said that while full employment is nearly within reach, low inflation means it’s not quite time for the Fed to hike rates.

"The concern about this situation is not to move before we see inflation as well as employment returning to more normal levels," said Fischer.

Craig Erlam, market analyst at Oanda, said: “If the Fed is not convinced by the inflation figures, I still think we could still see a rate hike this year but maybe a smaller one than expected, say 10 basis points. This would send the message that the path of rates is higher and the return to normalisation has begun, while not threatening the recovery or putting too much of a burden on US companies from the impact it would have on the dollar.”

Precision Castparts surges on Berkshire Hathaway deal

Deal news also helped to underpin the tone on Monday, with shares in Precision Castparts, which makes industrial components, up a whopping 20% after Warren Buffett’s Berkshire Hathaway said it would buy the company in a deal worth $37.2bn.

Alibaba was on the front foot after the e-commerce company announced that it would invest more than 28 billion yuan in a near-20% stake in Suning Commerce Group.

On the downside, shares in milk producer Dean Foods slumped. Its second-quarter profit beat expectations, but revenue fell more than anticipated.

The dollar was a little higher against the yen and a touch lower against the euro and the pound, while gold futures were up 0.2% at $1,096.

Oi prices were mixed, with West Texas Intermediate down 0.1% at $43.83 a barrel and Brent crude up 0.8% at $49.02.

Also on Monday, investors were digesting a series of Chinese data.

Figures released over the weekend showed Chinese exports dropped 8.3% from a year ago, while imports fell 8.1%. Meanwhile, inflation rose 1.6% in July, which is well below the government’s annual target of 3% and producer prices hit their lowest level since 2009.

The downbeat data had a positive impact on Chinese shares, however, raising expectations that Beijing will be forced to introduce further monetary stimulus and pushing the Shanghai Composite up nearly 5%.