Stocks Holding On To Strong Gains In Afternoon Trading - U.S. Commentary

(RTTNews) - After moving sharply higher earlier in the session, stocks continue to turn in a strong performance in afternoon trading on Monday. The gains on the day have largely offset the weakness that was seen during trading last week.

The major averages have moved roughly sideways in recent trading, hovering firmly in positive territory. The Dow is up 188.24 points or 1.1 percent at 17,937.55, the Nasdaq is up 45.22 points or 0.9 percent at 4,916.98 and the S&P 500 is up 21.57 points or 1.1 percent at 2,074.97.

The strength on Wall Street is partly due to a pullback by the value of the U.S. dollar, which is giving back ground following recent strength.

The dollar is currently trading at 121.31 yen compared to 121.40 yen on Friday and is valued at $1.0593 against the euro after ending last week at $1.0496.

Last week, the dollar added 0.5 percent against the yen and surged up 3.2 percent versus the euro amid concerns about the outlook for interest rates.

Meanwhile, traders have shrugged off a batch of disappointing economic data, including a report from the National Association of Home Builders showing that homebuilder confidence fell to its lowest level in eight months in March.

The report said the NAHB/Wells Fargo Housing Market Index fell to 53 in March from 55 in February. The drop surprised economists, who had expected the index to inch up to 56.

With the unexpected decrease, the housing market index fell to its lowest level since hitting a matching reading last July.

A separate report released by the Federal Reserve showed that industrial production grew by less than expected in the month of February.

The Fed said industrial production inched up by 0.1 percent in February following a revised 0.3 percent decrease in January.

Economists had expected production to rise by 0.3 percent compared to the 0.2 percent increase originally reported for the previous month.

Sector News

Most of the major sectors have moved to the upside on the day, reflecting broad based buying interest on Wall Street.

Biotechnology stocks are posting particularly strong gains, resulting in 2.4 percent jump by the NYSE Arca Biotechnology Index. With the gain, the index has reached a new record intraday high.

United Therapeutics (UTHR) and Amgen (AMGN) are turning in two of the biotech sector's best performances, surging up by 6.5 percent and 4.9 percent, respectively.

Significant strength is also visible among trucking stocks, as reflected by the 2.1 percent gain being posted by the Dow Jones Trucking Index. The gain has lifted the index to its best level in well over two months.

Utilities stocks are also turning in a strong performance on the day, driving the Dow Jones Utilities Average up by 1.9 percent. The average is climbing further off the nearly five-month closing low set last Wednesday.

Health care, railroad, airline, and networking stocks are also seeing notable strength, while modest weakness is visible among steel stocks.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Monday. Japan's Nikkei 225 Index edged down by less than a tenth of a percent, while Hong Kong's Hang Seng Index rose by 0.5 percent.

Meanwhile, the major European markets have all moved to the upside on the day. While the German DAX Index has surged up by 1.8 percent, the French CAC 40 Index is up by 0.8 percent and the U.K.'s FTSE 100 Index is up by 0.4 percent.

In the bond market, treasuries are seeing continued strength, extending a recent upward trend. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 3.7 basis points at 2.075 percent.