Stocks recovered from an initial move to the downside early in the session and remain mostly positive in afternoon trading on Tuesday. The Dow is moving higher for the seventh consecutive session, climbing to its best intraday level in well over a month.
Currently, the major averages are off their highs of the session but still in positive territory. The Nasdaq is up 140.92 points or 1.0 percent at 13,659.70, the S&P 500 is up 16.26 points or 0.4 percent at 4,382.24 and the Dow is up 61.52 points or 0.2 percent at 34,157.38.
Profit taking contributed to the initial weakness on Wall Street, as some traders looked to cash in on the recent strength in the markets.
Selling pressure waned shortly after the start of trading, however, with continued optimism about the outlook for interest rates contributing to the subsequent rebound.
The rebound by stocks also came as treasury yields have shown a notable move back to the downside after surging in the previous session.
Meanwhile, traders are also looking ahead to speeches by Federal Reserve Chair Jerome Powell on Wednesday and Thursday.
Powell is due to deliver opening remarks at the Division of Research and Statistics Centennial Conference on Wednesday and participate in a policy panel discussion before the 24th Jacques Polak Annual Research Conference on Thursday.
Traders are likely to pay close attention to Powell’s remarks, looking for additional confirmation the Fed will leave interest rates unchanged for the foreseeable future.
In U.S. economic news, a report released by the Commerce Department showed the U.S. trade deficit widened by more than expected in the month of September.
The Commerce Department said the trade deficit increased to $61.5 billion in September from a revised $58.7 billion in August.
Economists had expected the trade deficit to climb to $60.2 billion from the $58.3 billion originally reported for the previous month.
The wider than expected deficit came as the value of imports surged by 2.7 percent to $322.7 billion, while the value of exports jumped by 2.2 percent to $261.1 billion.
Software stocks continue to see substantial strength on the day, driving the Dow Jones U.S. Software Index up by 1.8 percent to its best intraday level in well over three months.
Considerable strength is also visible among biotechnology stocks, with the NYSE Arca Biotechnology Index climb by 1.3 percent.
Retail stocks are also turning in a strong performance, resulting in a 1.2 percent gain by the Dow Jones U.S. Retail Index. The index has reached its best intraday level in well over a month.
On the other hand, energy stocks have moved sharply lower on the day, with a steep drop by the price of crude oil weighing on the sector.
With crude for December delivery plunging $2.89 to $77.93 a barrel, the Philadelphia Oil Service Index is down by 3.2 percent and the NYSE Arca Oil Index is down by 2.3 percent.
Gold stocks are seeing significant weakness amid a decrease by the price of the precious metal, dragging the NYSE Arca Gold Bugs Index down by 2.9 percent.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Tuesday. Japan’s Nikkei 225 Index tumbled by 1.3 percent, while Hong Kong’s Hang Seng Index dove by 1.7 percent.
Meanwhile, the major European markets turned in a mixed performance on the day. While the German DAX Index inched up by 0.1 percent, the U.K.’s FTSE 100 Index edged down by 0.1 and the French CAC 40 Index fell by 0.3 percent.
In the bond market, treasuries have shown a strong move back to the upside following the sharp pullback seen on Monday. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 8.7 basis points at 4.575 percent.
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