U.S. Stocks Move Back To The Upside Following Last Week’s Pullback
Stocks moved mostly higher during trading on Tuesday as traders returned to their desks following the long holiday weekend. The tech-heavy Nasdaq ended the session just shy of the record closing high set earlier this month.
The major averages all closed in positive territory, with the Nasdaq outperforming its counterparts. While the Nasdaq jumped 198.68 points or 1.5 percent to 13,197.18, the Dow rose 116.26 points or 0.4 percent to 30,930.52 and the S&P 500 climbed 30.66 points or 0.8 percent to 3,798.91.
The strength on Wall Street came following the losses seen last week, when the Dow slid by 0.9 percent and the Nasdaq and the S&P 500 both slumped by 1.5 percent.
The major averages saw notable weakness last Friday after turning lower over the course of the session on Thursday, with the Dow and the Nasdaq pulling back after reaching record intraday highs.
The markets also benefited from continued optimism about additional stimulus as well as a faster rollout of coronavirus vaccines under incoming President Joe Biden.
Traders kept an eye on remarks from Treasury Secretary nominee Janet Yellen during her confirmation hearing before the Senate Finance Committee.
In prepared remarks, Yellen called for additional stimulus to address the impact of the ongoing coronavirus pandemic, arguing the government needs to “act big.”
Yellen acknowledged the mounting national debt facing the incoming administration but claimed the benefits of another relief package will far outweigh the costs.
Meanwhile, a steep drop by shares of Goldman Sachs (GS) limited the upside for the Dow, with the financial giant slumping by 2.3 percent despite reporting better than expected fourth quarter results.
Bank of America (BAC) also moved to the downside after reporting better than expected fourth quarter earnings but on revenues that missed estimates.
Sector News
Semiconductor stocks moved sharply higher over the course of the session, driving the Philadelphia Semiconductor Index up by 3.4 percent to a new record closing high.
Considerable strength was also visible among oil stocks, as reflected by the 2.4 percent jump by the NYSE Arca Oil Index.
The rally by oil stocks came amid an increase by the price of crude oil, with crude for February delivery climbing $0.62 to $52.98 a barrel.
Biotechnology stocks also saw significant strength on the day, resulting in a 1.8 percent advance by the NYSE Arca Biotechnology Index. The index reached its best closing level in six months.
Housing, software and pharmaceutical stocks also moved notably higher, while some weakness was visible among natural gas stocks.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Tuesday. Japan’s Nikkei 225 Index jumped by 1.4 percent, while Hong Kong’s Hang Seng Index soared by 2.7 percent.
Meanwhile, the major European markets showed modest moves to the downside on the day. While the U.K.’s FTSE 100 Index edged down by 0.1 percent, the German DAX Index dipped by 0.2 percent and the French CAC 40 Index fell by 0.3 percent.
In the bond market, treasuries bounced back near the unchanged line after seeing early weakness. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, slipped less than a basis point to 1.092 percent.
Looking Ahead
A report on homebuilder confidence may attract attention on Wednesday, while trading could also be impacted by any major developments at President-elect Joe Biden’s inauguration.
On the earnings front, Netflix (NFLX) is releasing its quarterly results after the close of today’s trading, while Morgan Stanley (MS) and Procter & Gamble (PG) are among the companies due to report their results before the start of trading on Wednesday.
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