NEW YORK - US stocks have risen modestly as gains in the tech sector helped buoy the Nasdaq to a record intraday high and solid housing market data provided more evidence the economy may be picking up momentum.
With the US earnings season winding down, investors are also turning their focus to the likelihood of a Federal Reserve interest rate rise in the coming months.
Fed chair Janet Yellen's speech on Friday (US time) at Jackson Hole will be scrutinised for clues on the timing of a rate rise, especially after some Fed policymakers in recent days hinted at the possibility of a hike in the near term.
The meeting, which includes central bankers from across the world, will begin on Thursday and traditionally has been a platform for the Fed to signal the direction of monetary policy.
Data on Tuesday showed that new US single-family home sales unexpectedly rose in July, reaching their highest level in nearly nine years as demand increased broadly, brightening the housing market outlook. The PHLX housing sector index rose 1.8 per cent for its best daily performance in about six weeks.
"It would be nice to see the economy pick up and be able to support higher interest rates, that would be a win for stocks," said Terry Morris, senior vice president and managing director of equities for BB&T Institutional Investment Advisors in Reading, Pennsylvania.
"If there is enough economic strength to support higher interest rates, that is the ideal scenario."
The Dow Jones industrial average rose 17.88 points, or 0.1 per cent, to 18,547.3, the S&P 500 gained 4.26 points, or 0.2 per cent, to 2,186.9 and the Nasdaq Composite added 15.48 points, or 0.3 per cent, to 5,260.08.
LONDON - European shares have crept up while the US dollar lost ground as investors awaited further clues on whether the Federal Reserve will raise US interest rates this year.
European equities were 0.5 per cent higher led by mining and banking stocks after data that pointed to a gradual improvement in the region's economy. The euro also posted gains.
Early encouragement came from France where surprisingly upbeat PMI figures showed the private sector growing at its fastest pace in 10 months, and in Denmark where consumer confidence jumped.
Germany's PMI reading also reassured, as a combined manufacturing and services sector survey came in comfortably above the line that separates growth from contraction.
"The German economy is continuing its uninterrupted upward trend in August," Markit Economist Oliver Kolodseike said.
London's FTSE 100 gained 0.59 per cent to 6,868.51, while Germany's DAX lifted 0.94 per cent to 10,592.88.
HONG KONG - Asian shares were mixed with Tokyo down more than half a per cent, Hong Kong flat and China down.
MSCI's broadest index of Asia-Pacific shares outside Japan added 0.3 per cent in slow trade.
A survey of Japanese manufacturing activity for August showed output rose for the first time in six months, but the improvement was marginal and investors fixed their focus on the Fed instead.
"The market does seem to be reluctantly acknowledging the chorus of senior Fed speakers who have suggested recently that a 2016 rate hike is still quite probable and September is 'live'," wrote analysts at ANZ in a note.
"But in reality, the response has been very muted."
The Nikkei 225 lost 0.6 per cent, to close at 16,497.36, the Hang Seng was flat at 22,998.93 while the Shanghai Composite Index gained 0.16 per cent to end at 3,089.71.
WELLINGTON - The S&P/NZX index increased 5.17 points, or 0.1 per cent, to 7,467.33