U.S. Stocks Remain Firmly Positive After Early Rally
After moving sharply higher in morning trading on Wednesday, stocks continue to see significant strength in the early afternoon. The strong upward move on the day has offset the pullback seen late in the previous session.
The major averages have pulled back off their best levels of the day but currently remain firmly positive. The Dow is up 339.99 points or 1.4 percent at 24,546.85, the Nasdaq is up 163.48 points or 1.8 percent at 9,348.59 and the S&P 500 is up 46.78 points or 1.6 percent at 2,969.72.
The rally on Wall Street partly reflects continued optimism about an economic recovery as states begin to reopen following the coronavirus-induced lockdowns.
Early indications suggest the states that have reopened have not seen a spike in coronavirus cases, which has led to hopes the economy may rebound more quickly than many economists predict.
Meanwhile, traders have largely shrugged off a report raising doubts about Moderna’s (MRNA) potential coronavirus vaccine.
The report from STAT News questioned the validity of the results of Moderna’s vaccine trial that had sent stock markets soaring on Monday.
Positive sentiment was also generated in reaction to earnings news from Lowe’s (LOW), with the home improvement retailer seeing modest strength after reporting first quarter results that exceeded analyst estimates on both the top and bottom lines.
The upward move on the day lifted the Nasdaq to its best intraday level in nearly three months, with the tech-heavy index less than 5 percent below the record high set in February.
Energy stocks helped to lead the way higher on the day, benefiting from a continued increase by the price of crude oil. Crude for July delivery is jumping $0.96 to $32.92 a barrel, moving higher for the fifth straight session.
Reflecting the strength in the energy sector, the Philadelphia Oil Service Index has surged up by 5.1 percent, the NYSE Arca Oil Index is up by 3.8 percent and the NYSE Arca Natural Gas Index is up by 2.8 percent.
Significant strength has also emerged among semiconductor stocks, as reflected by the 3.5 percent spike by the Philadelphia Semiconductor Index. With the jump, the index has reached a three-month intraday high.
Transportation, financial and chemical stocks are also seeing considerable strength, while gold stocks are among the few groups bucking the uptrend despite an increase by the price of the precious metal.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Wednesday. Japan’s Nikkei 225 Index climbed by 0.8 percent, while China’s Shanghai Composite Index fell by 0.5 percent.
Meanwhile, the major European markets all moved to the upside on the day. While the German DAX Index surged up by 1.3 percent, the U.K.’s FTSE 100 Index jumped by 1.1 percent and the French CAC 40 Index advanced by 0.9 percent.
In the bond market, treasuries have moved modestly higher over the course of the session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 1 basis point at 0.701 percent.
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