Feb 6 (Reuters) - The S&P 500 closed slightly higher on Tuesday, as investors scrutinized a mixed bag of earnings at big U.S. companies and digested comments from Federal Reserve policy makers for clues about its first planned interest-rate cut.
Minneapolis Fed President Neel Kashkari said the central bank is "not done yet" with inflation although he noted it had come down quickly with three-month and six-month inflation data "basically" at the Fed's 2% goal.
Also, Cleveland Fed President Loretta Mester said that if the U.S. economy performs as she expects this could open the door to rate cuts. But Mester said she was not ready yet to suggest timing for easier policy due to inflation uncertainty.
On Sunday, Fed Chair Jerome Powell dashed any remaining hopes for a March rate cut. He had said the Fed can be "prudent" in deciding when to cut with a strong economy allowing time to build confidence that inflation is under control.
"The big macro news today is a couple of Fed governors confirming what Powell said over the weekend. It's putting a little damper on markets today. It's a little follow through from yesterday," said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia.
According to preliminary data, the S&P 500 (.SPX), opens new tab gained 11.33 points, or 0.23%, to end at 4,954.14 points, while the Nasdaq Composite (.IXIC), opens new tab gained 12.16 points, or 0.07%, to 15,609.49. The Dow Jones Industrial Average (.DJI), opens new tab rose 138.20 points, or 0.36%, to 38,520.70.
John Praveen, Managing Director & Co-CIO at Paleo Leon suggested the Fed should not wait too long to ease policy as troubles at regional Bank NY Community Bancorp are spotlighting weakness in the rate-sensitive commercial real estate sector.
Powell also referred to the sector on Sunday. On Tuesday, U.S. Treasury Secretary Janet Yellen said she was concerned about commercial real estate stresses on banks and property owners, yet she believes the situation is manageable with assistance from bank regulators.
Praveen saw the comments adding to investor jitters.
The KBW Regional Banking index (.KRX), opens new tab fell again after losing around 11% in the previous five sessions and New York Community Bancorp (NYCB.N), opens new tab shares stretched a selloff since the lender's surprise quarterly loss last week.
Airlines helped advance the Dow Jones Transport Average (.DJT), opens new tab with some signs of strong demand. Frontier Group Holdings' (ULCC.O), opens new tab rallied after it surprised investors with a break-even financial report.
With over half of S&P 500 companies now having reported earnings, 81.2% surpassed expectations, according to LSEG data. Overall S&P 500 earnings are expected to have risen 8.1% in the fourth quarter from the year-ago quarter.
GE HealthCare Technologies (GEHC.O), opens new tab rose sharply after the medtech firm posted better-than-expected fourth-quarter earnings, driving the S&P 500 healthcare sector (.SPXHC), opens new tab to an all-time high.
The materials index (.SPLRCM), opens new tab gained ground with shares in chemicals firm DuPont de Nemours (DD.N), opens new tab jumping after it beat fourth-quarter profit estimates, announcing a $1 billion share-repurchase program and hiking its dividend.
Palantir Technologies (PLTR.N), opens new tab shares also soared after forecasting upbeat annual profit.
However, Eli Lilly (LLY.N), opens new tab reversed earlier gains even after forecasting 2024 profit above estimates.
Chip stocks pressured the tech-heavy Nasdaq. The Philadelphia SE Semiconductor index(.SOX), opens new tab underperformed during the session. Rambus Inc (RMBS.O), opens new tab led declines in the sector as its shares plunged after its quarterly report.
Reporting by Sinéad Carew in New York, Johann M Cherian and Ankika Biswas in Bengaluru; Editing by Pooja Desai and David Gregorio
