After showing a lack of direction early in the session, stocks have moved modestly higher over the course of the trading day on Tuesday. With the upward move on the day, the tech-heavy Nasdaq has reached new record intraday high.
Currently, the major averages are off their best levels but holding on to slim gains. The Dow is up 19.08 points or 0.1 percent at 33,896.05, the Nasdaq is up 51.70 points or 0.4 percent at 14,193.18 and the S&P 500 is up 14.18 points or 0.3 percent at 4,238.97.
The modest strength that has emerged on Wall Street has partly been attributed to a significant rebound by the value of bitcoin.
Bitcoin has climbed back near the unchanged line and briefly turned positive after the cryptocurrency tumbled below $30,000 earlier in the day.
Meanwhile, traders continue to look ahead to Federal Reserve Chair Jerome Powell’s testimony before the House Select Subcommittee on the Coronavirus Crisis this afternoon.
In prepared remarks, Powell noted the economy has shown sustained improvement since he last appeared before the committee, citing widespread Covid-19 vaccinations as well as unprecedented monetary and fiscal policy actions.
Powell acknowledged inflation has increased notably in recent months but reiterated the view that the jump is due to “transitory” factors and predicted inflation would drop back toward the Fed’s longer-run goal of 2 percent price growth.
The Fed chief warned the coronavirus pandemic continues to pose risks to the economic outlook, pointing to the slowing pace of vaccinations and new strains of the virus.
Powell stressed that the Fed will do “everything we can to support the economy for as long as it takes to complete the recovery.”
Traders are likely to keep an eye on the question-and-answer portion of Powell’s testimony for further clarity about the outlook for monetary policy.
On the U.S. economic front, the National Association of Realtors released a report showing existing home sales extended a recent pullback in May but fell by less than economists had expected.
Despite the uptick by the major averages, most of the major sectors continue to show only modest moves in early afternoon trading.
Retail stocks have shown a strong move to the upside, however, with the Dow Jones U.S. Retail Index climbing by 1.2 percent to its best intraday level in well over a month.
On the other hand, considerable weakness remains visible among airline stocks, as reflected by the 1.4 percent drop by the NYSE Arca Airline Index.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Tuesday. Japan’s Nikkei 225 Index soared by 3.1 percent, while China’s Shanghai Composite Index climbed by 0.8 percent.
The major European markets also moved to the upside on the day. While the U.K.’s FTSE 100 Index rose by 0.4 percent, the German DAX Index edged up by 0.2 percent and the French CAC 40 Index inched up by 0.1 percent.
In the bond market, treasuries have moved modestly higher after seeing early weakness. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 1.1 basis points at 1.473 percent.
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