Wall Street edges up ahead of Powell speech

Wall Street's main indexes have crept higher as investors assess stronger than expected producer prices data and await a speech by Federal Reserve chair Jerome Powell for clues on the interest-rate trajectory in the US economy.

US producer prices increased more than expected in April amid strong gains in the costs of services and goods, leading traders to pare back bets of a first rate cut in September.

"Sticky inflation looked downright stuck this morning after a much hotter-than-expected inflation reading. But with last month's numbers revised lower, this report may not have been as much of an upside shock as it first appeared to be," said Chris Larkin, managing director of trading and investing at E*TRADE from Morgan Stanley.

Focus will now be on Wednesday's consumer price figures to help assess whether the upside surprises in the first quarter were a blip or a worrying trend.

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Fed chair Powell is due to speak on Tuesday morning.

Sticky inflation and persistent labour market strength have prompted financial markets and most economists to push back expectations for an initial Fed interest rate cut to September, from March seen at the start of the year.

Still, stocks have rallied so far this year, with all three major US indexes hovering near fresh record highs thanks to better-than-expected earnings for the first quarter and hopes that the Fed will cut rates sometime this year.

In early trading, the Dow Jones Industrial Average rose 71.74 points, or 0.18 per cent, to 39,503.25, the S&P 500 gained 5.51 points, or 0.11 per cent, to 5,226.93 and the Nasdaq Composite gained 29.78 points, or 0.18 per cent, to 16,417.33.

US-listed shares of Alibaba shed 6.0 per cent in early trading after reporting a 86 per cent drop in fourth-quarter profit.

On Holding climbed 13.7 per cent after the footwear maker posted a beat-and-raise quarter for sales on strong demand for its running shoes.

Meanwhile, US President Joe Biden unveiled a bundle of steep tariff increases on an array of Chinese imports including electric vehicles, computer chips and medical products.

US-listed shares of Chinese EV maker Li Auto slid 1.7 per cent.

Tesla gained 3.0 per cent, boosting indexes.

GameStop jumped 62.8 per cent, set to extend its rally after flag bearer Roaring Kitty posted on X.com for the first time in three years.

Other 2021 meme rally participants and highly shorted stocks such as AMC Entertainment and Koss Corp rose 86 per cent and 33.1 per cent respectively.

Advancing issues outnumbered decliners by a 3.93-to-1 ratio on the NYSE and by a 2.62-to-1 ratio on the Nasdaq.

The S&P 500 posted 12 new 52-week highs and no new lows while the Nasdaq recorded 71 new highs and 39 new lows.