Stocks have moved mostly higher in morning trading on Tuesday, adding to the strong gains posted last week. With the continued advance, the major averages have once again reached new record intraday highs.
Currently, the major averages are just off their highs of the session. The Dow is up 140.68 points or 0.5 percent at 31,599.08, the Nasdaq is up 67.55 points or 0.5 percent at 14,163.02 and the S&P 500 is up 14.35 points or 0.4 percent at 3,949.18.
The markets continue to benefit from recent upward momentum, as traders remain optimistic about additional stimulus from Washington.
Recent signs indicating the coronavirus crisis is easing following a recent surge has also generated buying interest as countries around the world continue to ramp up vaccine rollouts.
The positive sentiment also comes following last Friday’s drop by the CBOE Market Volatility Index, which closed below 20 for the first time in nearly a year.
The decrease by the closely watched volatility index suggests there is reduced fear in the markets following the spike seen in reaction to speculative trading in stocks like GameStop (GME).
Traders may be less worried about a substantial pullback by the markets even as some analysts continue to warn the markets are overbought.
In U.S. economic news, the Federal Reserve Bank of New York released a report showing New York manufacturing activity grew at its fastest pace in months in February.
The New York Fed said its general business conditions index climbed to 12.1 in February from 3.5 in January, with a positive reading indicating growth in regional manufacturing activity. Economists had expected the index to rise to 6.0.
With the much bigger than expected increase, the general business conditions index reached its highest level since hitting 17.0 last September.
A slew of economic data is due to be released in the comings days, including reports on retail sales, industrial production, housing starts, and existing home sales.
Energy stocks are seeing substantial strength in morning trading, as the price of crude oil has seen further upside after a winter storm shut down oil wells and refineries in Texas. Crude for March delivery is off its highs but remained up $0.31 at $59.80 a barrel.
Reflecting the strength in the energy sector, the Philadelphia Oil Service Index is up by 3.1 percent, the NYSE Arca Oil Index is up by 3 percent and the NYSE Arca Natural Gas Index is up by 2.3 percent.
Considerable strength has also emerged among steel stocks, as reflected by the 3 percent jump by the NYSE Arca Steel Index. The index has risen to its best intraday level in a month.
Airline, banking and brokerage stocks are also seeing significant strength on the day, while biotechnology and housing stocks have moved to the downside.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Tuesday. Japan’s Nikkei 225 Index jumped by 1.3 percent, while Hong Kong’s Hang Seng Index soared by 1.9 percent.
Meanwhile, the major European markets have moved to the downside on the day. While the French CAC 40 Index has dipped by 0.2 percent, the U.K.’s FTSE 100 Index and the German DAX Index are both down by 0.3 percent.
In the bond market, treasuries have come under pressure, driving the yield on the benchmark ten-year note to its highest level since last March. The yield on the ten-year note, which moves opposite of its price, is up by 6.2 basis points at 1.262 percent.
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