Wall Street were at session highs on Tuesday morning, led by financial and technology stocks, after strong US factory and construction data suggested the economy was regaining momentum after slowing in the fourth quarter. While manufacturing activity contracted in February, steadying new orders growth and improving inventories offered signs of stability. Construction spending in January surged to the highest level since 2007.
"Things were never as bad as we thought they were and now we're realising it," said Brad McMillan, chief investment officer at Commonwealth Financial Network in Waltham, Massachusetts. The encouraging data will factor into the US Federal Reserve's decision, when they deliberate on further raising interest rate hikes.
While Fed Chair Janet Yellen has hinted at continuing with the central bank's plan to raise rates gradually through the year, other policymakers are calling for a pause amid the turmoil in global financial markets and slowing global growth. At 11:38 a.m. ET (1638 GMT), the Dow Jones industrial average was up 225.51 points, or 1.37 percent, at 16,742.01. The S&P 500 was up 29.8 points, or 1.54 percent, at 1,962.03 and the Nasdaq Composite index was up 85.64 points, or 1.88 percent, at 4,643.59. The S&P and the Nasdaq were on track for their best one-day percentage gain since February 17.