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US open: Stocks start off strong as tech rally lifts Nasdaq

Tue, 1st Sep 2020 15:41

(Sharecast News) - Wall Street trading got off to a positive start on Tuesday after the index closed out its best August in over 30 years in the previous session and the tech-heavy Nasdaq got off to a strong start on the back of another rally in the sector.
As of 1540 BST, the Dow Jones Industrial Average was up 0.27% at 28,507.34, while the S&P 500 was 0.40% firmer at 3,514.18 and the Nasdaq Composite started out the session 1.06% stronger at 11,900.50.

The Dow Jones opened 77.29 points higher on Tuesday, reversing some of the previous session's losses that came as Salesforce, Amgen and Honeywell replaced longtime components of the index Exxon Mobil, Pfizer and Raytheon Technologies.

Investors were digesting the Institute for Supply Management's latest services sector purchasing managers' index after the bell on Tuesday, with the index advancing from a reading of 54.2 for July to 56.0 in August.

A key sub-index tracking companies' new orders jumped from 61.5 to 67.6, while another linked to order backlogs increased from 51.8 to 54.6. The sub-index tied to staffing levels remained beneath the 50.0-point mark at 46.4.

IHS Markit's final manufacturing PMI also improved in August, expanding to 53.1 from 50.9 in July. However, the reading was slightly weaker than the 53.6 forecast.

Chris Williamson, IHS Markit's chief business economist, said: "The manufacturing upturn gained further ground in August, adding to indications that the third quarter should see a strong rebound in production from the steep decline suffered in the second quarter."

The US dollar was also in focus on Tuesday after the greenback tumbled again and sent the dollar to its lowest level in 28 months, while gold was up 0.31% early on at $1,972.59.

Elsewhere on the macro front, construction spending in the US registered only the slightest of increases in July as heightened outlays on private projects was all but offset by a sharp decline in public construction projects.

The Commerce Department said construction spending edged up 0.1%, while data for June was revised to show construction outlays falling 0.5% instead of the 0.7% previously reported.

Still to come, Federal Reserve governor Lael Brainard will deliver a speech on the central bank's monetary policy framework review at 1800 BST.

In corporate news, Apple shares were in focus after Bloomberg reported that the tech giant was gearing up for the launch of a raft of new products, including four new 5G iPhone models, while Tesla was also in the news after announcing it planned to raise up to $5.0bn in a share-sale programme a day after a stock split that helped propel the electric car' maker's stock to new heights.

Zoom Video shares surged in early trading after revealing overnight that second-quarter revenues had more than quadrupled.

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