Wall Street lingers near records overnight

Specialist Michael Pistillo, left, and trader Tommy Kalikas work on the floor of the New York Stock Exchange. File photo / AP

Wall Street edged higher overnight, trading near record highs, as Federal Reserve Chair Janet Yellen gave a second day of testimony to Congress.

Yellen on Tuesday suggested the Fed won't need to raise interest rates for "at least the next couple of FOMC meetings." She repeated the main points of her comments to members of the House of Representatives today; yesterday she spoke to the Senate's banking committee.

The latest US corporate earnings were mixed. Shares of discount retailers Dollar Tree climbed 3 per cent and TJX Cos rallied 3.5 per cent after reporting their latest earnings. However, shares of Hewlett-Packard sank 9.5 per cent, while Chesapeake Energy dropped 8.8 per cent as their respective earnings disappointed.

Overall, though, with more than 90 per cent of companies having already reported, 74 per cent of those exceeded profit projections while 56 per cent topped sales estimates, according to Bloomberg.

In afternoon trading on Wall Street, the Dow Jones Industrial Average rose 0.03 per cent, the Standard & Poor's 500 Index added 0.05 per cent, while the Nasdaq Composite Index gained 0.24 per cent. Both the Dow and the S&P 500 are trading near record highs.

"Momentum is still there, you have support from central banks, and the US economy is looking pretty decent," Allan von Mehren, chief analyst at Danske Bank in Copenhagen, told Bloomberg. "Markets interpreted Yellen to be a little more to the softer side. It's been a rapid rally this month, so maybe we'll rise a bit more steadily from here."

Gains in shares of McDonald's and those of General Electric, last up 2 per cent and 1.8 per cent respectively, outweighed slides in shares of UnitedHealth and those of Cisco, down 1.1 per cent and 0.8 per cent respectively.

The latest housing data were solid. US new home sales slipped 0.2 per cent in January to a better-than-expected annualised rate of 481,000 properties, just below the upwardly revised 482,000 rate in December, which the highest since June 2008.

"We are still taking sort of a meandering, bumpy path towards recovery," Stephanie Karol, a US economist at IHS Global Insight in Lexington, Massachusetts, told Reuters. "We expect housing will improve later this year due to the improvement in the labour market and credit conditions."

In Europe, the Stoxx 600 Index finished the session with a 0.1 per cent decline from the previous close, as did France's CAC 40 Index. The FTSE 100 Index, which set a record high on Tuesday, slipped 0.2 per cent. Germany's DAX eked out a 0.04 per cent gain.

"We have decreasing tensions with the Greek problem and now the market is looking for new positive drivers, but we do not really have any, so I expect more or less a breather in the next few days and some consolidation moves," Christian Stocker, a strategist at UniCredit Bank in Munich, told Bloomberg.