US open: Stocks nudge higher amid earnings avalanche

US stocks edged tentatively higher in early trade amid an avalanche of earnings as investors awaited the outcome of the Federal Reserve’s two-day policy meeting on Wednesday.

At 1445 BST, the Dow Jones Industrial Average was up 0.1%, the S&P 500 was 0.2% firmer and the Nasdaq was 0.3% higher.

Investors waded through a veritable deluge of earnings news.

DuPont was in the black after the chemicals and seeds producer posted an 8.5% increase in second-quarter profit.

Under Armour rallied after the sports clothing retailer posted a drop in second-quarter earnings that met expectations.

United Technologies was also on the front foot after it reported a decline in second-quarter profit but lifted its guidance for the year.

Caterpillar gained ground on better-than-expected second-quarter numbers, although it cut its outlook for 2016 sales and profits.

Starwood Hotels was little changed after saying it swung to a loss in the second quarter.

On the downside, McDonald’s shares were under the cosh after the company’s second-quarter sales growth in the US failed to impress.

Verizon Communications edged lower following mixed second-quarter earnings, while 3M slipped after it posted a drop in quarterly profit and cut its outlook for 2016.

After the closing bell, market participants will eye third-quarter results from technology giant Apple, with analysts expecting earnings of $1.39 per share, down from $1.85 the year before. Meanwhile, revenue has been pencilled in at $42.1bn versus $49.6bn a year earlier.

The Federal Reserve’s rate announcement is due on Wednesday. Ipek Ozkardeskaya, senior market analyst at London Capital Group, said: “We expect the Fed to maintain the status quo and to join the wait-and-see camp amid post-Brexit uncertainties.

“The FOMC will likely emphasise the importance of future economic data and deliver a dovish accompanying statement to grant its support to the markets. The S&P500 and the Dow could surf on a fresh wave of cheap money, should the Fed leaves the punchbowl on the table.”

On the data front, house prices in the US rose less than expected in May, according to the S&P/Case-Shiller National Home Price Index.

The S&P/Case-Shiller 20-City Composite index was up 5.2%, down from a 5.4% increase in April and missing consensus expectations for 5.5% growth.

Portland, Seattle and Denver reported the highest year-over-year gains among the 20 cities over each of the last four months.

In May, Portland led the way with a 12.5% year-over-year price increase, followed by Seattle at 10.7%, and Denver with a 9.5% increase.