After moving sharply higher early in the session, stocks have seen further upside over the course of the trading day on Tuesday. With the strong upward move on the day, the major averages have more than offset the downturn seen in the previous sessions.
Currently, the major averages are hovering near their best levels of the day. The Dow is up 580.44 points or 1.9 percent at 31,653.05, the Nasdaq is up 282.40 points or 2.5 percent at 11,642.45 and the S&P 500 is up 83.88 points or 2.2 percent at 3,914.73.
The rebound on Wall Street comes as traders make another attempt at bargain hunting after the rally seen in early trading on Monday faded as the day progressed.
Optimism about upcoming earnings news has also been cited as a reason for the rally, with a majority of the S&P 500 companies beating expectations so far this season.
Toymaker Hasbro (HAS) and oil services giant Halliburton (HAL) are posting notable gains after reporting better than expected quarterly earnings.
On the other hand, shares of IBM Corp. (IBM) have moved sharply lower after the tech giant reported better than expected second quarter results but lowered its cash flow forecast.
Healthcare giant Johnson & Johnson (JNJ) also moved to the downside after reporting second quarter results that beat analyst estimates but cutting its full-year guidance.
Meanwhile, traders have largely shrugged off a report from the Commerce Department unexpectedly showing a continued decline in housing starts in the month of June.
The Commerce Department said housing starts slumped by 2.0 percent to an annual rate of 1.559 million after plunging by 11.9 percent to a revised rate of 1.591 million in May.
The continued decrease came as a surprise to economists, who had expected housing starts to jump by 2.3 percent to an annual rate of 1.585 million from the 1.549 million originally reported for the previous month.
With the unexpected decrease, housing starts dropped to the lowest annual rate since hitting 1.505 million in April of 2021.
The report showed building permits also fell by 0.6 percent to an annual rate of 1.685 million in June after tumbling by 7.0 percent to a rate of 1.695 million in May.
Building permits, an indicator of future housing demand, were expected to slump by 2.7 percent to an annual rate of 1.650 million.
Semiconductor stocks are turning in some of the market’s best performances on the day, resulting in a 4 percent spike by the Philadelphia Semiconductor Index.
Substantial strength is also visible among networking stocks, as reflected by the 3.2 percent surge by the NYSE Arca Networking Index.
Airline stocks also continue to see considerable strength in afternoon trading, with the NYSE Arca Airline Index soaring by 3.2 percent.
Chemical, computer hardware and oil stocks have also shown notable moves to the upside, reflecting broad based buying interest on Wall Street.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Tuesday. Japan’s Nikkei 225 Index climbed by 0.7 percent, while Hong Kong’s Hang Seng Index fell by 0.9 percent.
Meanwhile, the major European markets all showed strong moves to the upside on the day. While the German DAX Index spiked by 2.7 percent, the French CAC 40 Index surged by 1.8 percent and the U.K.’s FTSE 100 Index jumped by 1.0 percent.
In the bond market, treasuries have come under pressure amid the rally on Wall Street. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 5.2 basis points at 3.012 percent.
Source: Read Full Article