New York, Aug 8: Stocks clung to their gains in late morning trading on Tuesday, buoyed by surprisingly strong US productivity data that underscored the market's conviction the Federal Reserve will hold interest rates steady this month. But Wall Street's enthusiasm was dampened as traders locked in profits on the market's recent rise."The economic news is really outstanding and it's trickling into the market," said Alfred Kugel, senior investment strategist at Stein, Roe & Farnham.Analysts said the data indicated the Fed, which has long fretted that the tight labour market could fan the flames of wage inflation and cause the economic expansion to overheat, could finally rest easy.The Dow Jones industrial average was up 31.68 points, or 0.29 percent, at 10,898.69.The blue chip gauge's gain was capped by weakness in its interest-rate sensitive Financial components. Wall Street brokerage J.P. Morgan fell 2-6/16 to 140-1/16.
The broader Standard & Poor's 500 Index was down 1.35 points, or 0.09 percent, at 1,77.97. The technology-laced Nasdaq Composite Index meanwhile, was up 5.03 points, or 0.13 percent, at 3,868.02.The government reported that US non-farm productivity rose 5.3 percent in the second quarter, exceeding Wall Street expectations for a 4.3 percent gain. In the first quarter, productivity grew a revised 1.9 percent.
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