Wall Street rises on lower rate-hike odds, merger activity

The New York Stock Exchange (NYSE) in lower Manhattan on August 26, 2016.
The New York Stock Exchange (NYSE) in lower Manhattan on August 26, 2016.PHOTO: AFP

NEW YORK (REUTERS) - Wall Street was higher on Tuesday morning as lower chances of an interest rate hike and a host of multi-billion dollar takeover deals boosted investor sentiment.

Top Federal Reserve officials, encouraged by a string of strong economic data, had hinted that a rate hike could come as early as this month. However, Friday's disappointing employment numbers dampened those expectations.

Traders now see a 21 per cent chance of a rate hike this month, down from 24 per cent, following the jobs data. The odds edged down to 50.6 per cent from 53.6 per cent for December, according to CME Group's FedWatch tool.

The dollar index fell 0.2 per cent on Tuesday. "The markets probably got what they most wanted," said Andre Bakhos, managing director at Janlyn Capital. "The jobs number wasn't strong enough to strike fear of a rate hike this month, nor weak enough to cast doubts on the economy."

At 9:41 a.m. ET (9:41 p.m Singapore time) the Dow Jones industrial average was up 46.06 points, or 0.25 per cent, at 18,538.02. The S&P 500 was up 2.45 points, or 0.11 per cent, at 2,182.43. The Nasdaq Composite was up 11.65 points, or 0.22 per cent, at 5,261.55.

Six of the 10 major S&P 500 indexes were higher, led by a 0.77 percent rise in energy.