* Autozone’s weak report weighs on auto part retailers
* Single-family home sales, manufacturing data disappoint
* S&P 500 tops 2,400 pts for first time since Wednesday selloff
* Dow up 0.29 pct, S&P up 0.24 pct, Nasdaq up 0.10 pct (Updates to late afternoon, adds commentary, changes byline)
By Sinead Carew
May 23 (Reuters) - Wall Street edged higher on Tuesday as investors digested President Donald Trump’s budget plan, but a drop in consumer discretionary stocks offset a boost from the financial sector.
While Tuesday’s economic data was weak, investors appeared relieved that President Donald Trump’s first full budget plan was largely as expected.
“There were no large surprises. The market is pleased with that,” said Wade Balliet, Chief Investment Strategist at Bank of the West.
Trump’s budget called for a hike in infrastructure and military spending, along with a raft of politically sensitive cuts, including to healthcare and food assistance programs for the poor, with the aim of chopping government spending by $3.6 trillion and balancing the budget over the next decade.
The S&P 500 was on track for its third straight day of gains and briefly topped 2,400 points for the first time since the markets’ plunge last Wednesday on concerns about the future of Trump’s presidency.
While the president is on an overseas trip, stocks were helped by the fact that a few days have passed without major new updates in a government probe on possible collusion between the Trump election campaign and Russia.
“With the President being away, with the news cycle slowing a little bit, investors have nibbled their way back in,” said Rick Meckler, president of LibertyView Capital Management in Jersey City, New Jersey.
“This market has had tremendous strength on the idea that the new administration is going to be able to push through a pro-business platform. To the extent it loses political credibility the market has had trouble holding these gains.”
At 3:09PM ET, the Dow Jones Industrial Average was up 59.6 points, or 0.29 percent, to 20,954.43, the S&P 500 had gained 5.75 points, or 0.24 percent, to 2,399.77 and the Nasdaq Composite had added 6.17 points, or 0.10 percent, to 6,139.79.
Meanwhile, U.S. economic data showed new single-family home sales in April tumbled from near a nine-and-a-half-year high, while manufacturing activity for May fell to the lowest level since September.
The market appeared to have shrugged off news of a suicide attack in Britain. U.S. futures had slipped slightly on Monday evening, before recovering, on news of the attack that killed 22 people and wounded many more at a pop concert in the English city of Manchester.
Ten of the 11 major S&P 500 sectors were higher, with financials leading the gains.
Consumer discretionary was the biggest laggard with a 0.35 percent drop, as auto part retailers weighed.
Autozone fell 10.6 percent to $589.53 after the auto part retailer’s quarterly results missed expectations. Advance Auto Parts fell 4.4 percent while O‘Reilly Automotive fell 3.5 percent and Genuine Parts shares fell 1.6 percent.
Advancing issues outnumbered declining ones on the NYSE by a 1.65-to-1 ratio; on Nasdaq, a 1.17-to-1 ratio favored advancers.
The S&P 500 posted 49 new 52-week highs and 8 new lows; the Nasdaq Composite recorded 79 new highs and 54 new lows.
Reporting by Tanya Agrawal, Additional reporting by Gayathree Ganesan; Editing by Savio D'Souza and Nick Zieminski