US open: Strong trading following Powell's Jackson Hole speech
US stocks opened strong on Friday as investors mulled over a speech by Federal Reserve chairman Jerome Powell at the Jackson Hole symposium and ongoing trade talks between the US and China.
At 1530 BST, the Dow Jones was up 0.35% to 25,747.64, the S&P 500 was trading 0.37% higher at 2,867.63 and the Nasdaq was 0.63% firmer at 7,928.31.
All eyes were on Powell's speech, particularly after Trump criticised the Fed earlier in the week and following the release of the FOMC minutes on Wednesday.
Powell said the central bank's gradual path of interest-rate hikes remained appropriate given there was no "elevated risk of overheating".
In his speech at the Jackson Hole summer retreat, Powell said inflation had recently moved up near 2% but looking past that, he had seen "no clear sign of an acceleration".
"My colleagues and I believe that this gradual process of normalization remains appropriate," he said.
Powell did warn that there were certain risk factors "abroad and at home that, in time, could demand a different policy response," but did not go into detail.
Rabobank hadn't expected Powell's comments to deviate from the message already laid down in the minutes from the July 31-August 1 meeting published this week, "which all but explicitly confirmed the Fed is set to hike the Fed Funds rate in September".
Trade relations between the US and China were still in focus. There were no breakthroughs in this week's talks as both countries imposed 25% tariffs on $16n worth of each other's goods, although the Chinese commerce ministry did say that discussions had been "constructive" and "candid".
Chinese finance minister Liu Kun told Reuters that while China doesn't want to engage in a trade war, it will "resolutely respond" to the "unreasonable measures" taken by the US.
"Both sides have turned the screws on each other as new tariffs were introduced by both countries yesterday," said CMC Markets analyst David Madden. "The trading relationship is still a work in progress, and investors are cautious. Chinese stocks are still fragile and the renminbi is still weak, and this adds weight to the argument that the US has the upper hand."
In corporate news, shares of Buckle Inc inched ahead 0.45% in early trade as its second-quarter earnings topped expectations, while those of Foot Locker sank 10.47% despite the retailer's second-quarter earnings and revenues beating estimates.
Hibbett Sports stock meanwhile tumbled 27.72% at the open after posting a second-quarter loss and downgrading its full-year profit outlook.
Autodesk surged 13.99% and HP shares dipped 3.12% following their quarterly numbers late on Thursday.
Intuit Inc picked up 1.39% in early trade after announcing the departure of its chief executive officer.
On the macroeconomic front, orders in the US for goods made to last more than three years were much weaker-than-expected last month, but wholly due to declines in the oft-volatile categories for both civilian and military aircraft.
Total durable goods orders fell by 1.7% month-on-month in July to reach $246.9bn, according to the Department of Commerce.
That was much weaker than the 0.8% jump that analysts had pencilled-in.
Versus a year ago they were 8.6% higher.