Wall Street edges higher as investors await new economic cues from Fed

The Dow Jones Industrial Average rose 57.54 points, or 0.19 per cent

US stock indexes rose on Tuesday as progress toward a massive government stimulus bill kept spirits high, while investors hoped for continued signals of easy monetary policy from the Federal Reserve's final meeting of the year.

Apple Inc was the top boost to all three US benchmarks, rising 3.5 per cent to a more than three-month high after a report said it plans to increase iPhone production by 30 per cent in the first half of 2021.Markets saw a recent spike in coronavirus infections and deaths as pushing the case for the quick passing of a Covid-19 stimulus bill, with economically sensitive sectors such as consumer discretionary, materials andutilities gaining the most.

The S&P 500 materials sector was trading within spitting distance of a record high.

Talks in Congress were underway late on Monday to agree on a bill to avert a government shutdown, with Democrat and Republican leaders appearing more upbeat about including a fresh round of coronavirus aid, the first new relief measure since April.

The Fed is also expected to signal easy monetary policy for the foreseeable future in its two-day meeting starting Tuesday.

The recent coronavirus vaccine roll-out is expected to improve the central bank's 2021 outlook.

At 12:06 p.m. ET, the Dow Jones Industrial Average was up 190.68 points, or 0.64 per cent, at 30,052.23, the S&P 500 was up 25.63 points, or 0.70 per cent, at 3,673.12. The Nasdaq Composite was up 72.32 points, or 0.58 per cent, at 12,512.36.

Technology stocks added 0.9 per cent. The sector has outperformed its peers through the pandemic due to its perceived resilience to virus-related disruptions.

"The market likes to go to tech when it is afraid the economy may stall because of a rise in infections and shutdowns," said Christopher Grisanti, chief equity strategist at MAI Capital Management.

Increased liquidity and ultra-low lending rates have seen investors flocking to stocks for returns through the Covid-19 pandemic, while recent optimism over a vaccine pushed the S&P 500 to a series of record highs last week.

"We remain overweight on equities and have added selective exposure to more cyclically oriented sectors, including industrials, materials, semiconductors, housing and consumer durables," Erin Browne and Geraldine Sundstrom, managing directors at investment manager PIMCO wrote in a note.

Eli Lilly and Co rose 3.8 per cent after the company said it would buy Prevail Therapeutics Inc in a deal potentially valued at $1.04 billion, to expand its presence in the lucrative field of gene therapy. Prevail's shares surged about 83 per cent.

Moderna Inc's shares fell 4.8 per cent, even as US Food and Drug Administration staff members did not raise any new concerns over data on the drugmaker's Covid-19 vaccine. 

A report said the vaccine will gain emergency use approval on Friday.

Advancing issues outnumbered decliners for a 2.59-to-1 ratio on the NYSE and a 1.82-to-1 ratio on the Nasdaq.

The S&P index recorded 11 new 52-week highs and two new lows, while the Nasdaq recorded 116 new highs and 17 new lows.