US open: Boeing, 3M push Dow Industrials to fresh record-high

Wall Street's main indices are again heading higher on Tuesday as the Federal Reserve kicks off its two-day rate-setting meeting and several positive updates from corporate heavyweights such as Boeing and 3M.

At 1645 GMT, the Dow Jones Industrial Average was ahead by 0.56% or 136.15 points to 24,521.75, alongside a gain of 0.31% or 8.10 points to 2,668.10 on the S&P 500 and a rise of 8.20 points or 0.12% for the Nasdaq Composite.

From a sector standpoint, the best gains were to be seen in Fixed Line Telecommunications (1.91%), Telecommunications (1.87%) and Oil Equipment services (1.60%).

The KBW index of lenders shares was also continuing to push higher, gaining 0.96% to 107.19.

On the economic front, US factory gate prices advanced at a 3.1% clip year-on-year in November (consensus: 3.0%), with the details of the report leading economists at Barclays and Pantheon Macroeconomics to conclude that inflationary pressures were in the pipeline.

In parallel, the NFIB reported that its small business confidence gauge jumped back to a Reagan-era high of 107.5 last month, the second best reading in that gauge's 44-year history.

In the background, the US dollar spot index was 0.34% higher at 94.19 points, alongside a reversal in West Texas Intermediate crude oil futures which were down by 1.38% to $57.20 a barrel on the NYMEX.

Losses for oil were trigerred by a statement from the International Energy Agency saying it was monitoring events around the Forties North Sea pipeline but that there was no reason to act as the market remained well-supplied.

Ahead of the FOMC announcement due on Wednesday, analysts at Rabobank said: "A raise in the target range for the federal funds rate to 1.25-1.50%, from 1.00-1.25%, is widely expected. The same is true for a raise in the reinvestment caps of the balance sheet normalisation programme to $20bn from $10bn. Since the third rate hike of the year has been well-telegraphed by the Fed, and the balance sheet is on autopilot, markets are likely to focus on the fresh set of projections, in particular the dot plot.

"Do the FOMC participants still expect to hike three times in 2018? Are they still banking on the Phillips curve or are doubts about the inflation outlook setting in? And are they ready to incorporate the expected tax cuts in their projections?"

On the corporate front, aerospace group Boeing was sharply higher after saying late on Monday that it was lifting its dividend and announced a new $18bn share buyback.

Comcast shares were also active after the company said it no longer plans to make a bid for the entertainment assets of 21st Century Fox, leaving Walt Disney as the sole bidder.

Post-it maker 3m was in focus as well after saying it expected 2017 earnings per share and sales growth at the top half of the guidance range.

JetBlue Airways stock on the other hand was trading lower despite the carrier having raised its fouth quarter revenue guidance, saying the impact from the hurricanes in the Gulf of Mexico had been less than anticipated.