U.S. Stocks Riding Upward Momentum To Best Levels In Over A Year
Stocks have moved mostly higher in morning trading on Wednesday, as recent upward momentum has continued to prevail. The major averages have all moved to the upside, once again reaching their best intraday levels in over a year.
Currently, the major averages are off their highs of the session but still in positive territory. The Dow is up 193.11 points or 0.6 percent at 35,145.04, the Nasdaq is up 57.54 points or 0.4 percent at 14,411.18 and the S&P 500 is up 18.23 points or 0.4 percent at 4,573.21.
The strength on Wall Street extends the upward trend seen for much of the past two weeks, with the Dow moving higher for the eighth consecutive session.
Encouraging inflation data helped trigger the advance, as traders grow increasingly optimistic the Federal Reserve is nearing the end of its interest rate hikes.
The Fed is widely expected to raise rates by another quarter point next week, but traders are hopeful that will be the last.
Data indicating the economy has held up relatively well in spite of the Fed’s aggressive rate hikes has also led to confidence the economy will avoid a “hard landing.”
Largely upbeat earnings news has added to the positive sentiment as traders look ahead to the release of quarterly results from IBM Corp. (IBM), Netflix (NFLX) and Tesla (TSLA) after the close of trading.
Meanwhile, traders have shrugged off a Commerce Department report showing a sharp pullback in housing starts in the month of June.
The Commerce Department said housing starts plunged by 8.0 percent to an annual rate of 1.434 million in June after spiking by 15.7 percent to a revised rate of 1.559 million in May.
Economists had expected housing starts to plummet by 9.3 percent to a rate of 1.480 million from the 1.631 million originally reported for the previous month.
The report said building permits also tumbled by 3.7 percent to an annual rate of 1.440 million in June after surging by 5.6 percent to a revised rate of 1.496 million in May.
Building permits, an indicator of future housing demand, were expected to edge down by 0.1 percent to a rate of 1.490 million from the 1.491 million originally reported for the previous month.
Telecom stocks have moved sharply higher in morning trading, continuing to recover from the sell-off seen on Friday and Monday.
The NYSE Arca North American Telecom Index has spiked by 3.8 percent, climbing further off its lowest closing level in over three years.
Significant strength is also visible among banking stocks, as reflected by the 1.9 percent jump by the KBW Bank Index. With the gain, the index has reached a four-month intraday high.
Utilities, airline and commercial real estate stocks are also seeing considerable strength on the day, while steel and housing stocks have moved to the downside.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Wednesday. Japan’s Nikkei 225 Index shot up by 1.2 percent, while Australia’s S&P/ASX 200 Index rose by 0.6 percent.
Most European stocks have also moved to the upside on the day. While the U.K.’s FTSE 100 Index has surged by 2.0 percent and the French CAC 40 Index is up by 0.3 percent and the German DAX Index is up by 0.1 percent.
In the bond market, treasuries have pulled back near the unchanged line after seeing initial strength. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by less than a basis point at 3.782 percent.
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