Stocks Moving Higher For Third Consecutive Session - U.S. Commentary

(RTTNews) - After moving mostly higher over the course of the two previous sessions, stocks have seen further upside in early trading on Wednesday. The major averages have climbed firmly into positive territory on the last full day of trading before Christmas.

Currently, the major averages are near their highs for the young session. The Dow is up 123.14 points or 0.7 percent at 17,540.41, the Nasdaq is up 34.13 points or 0.7 percent at 5,035.24 and the S&P 500 is up 16.55 points or 0.8 percent at 2,055.52.

The strength on Wall Street partly reflects the recent upward momentum, with the major averages further offsetting the sharp pullback seen late last week.

Stocks may also be benefiting from traders doing some window dressing as the year winds down as well as strength in the overseas markets.

Buying interest has also been generated by a sharp increase by the price of crude oil, which has contributed to significant strength among energy stocks.

Crude for February delivery is jumping $1.22 to $37.36 a barrel due partly to a report showing a sharp drop in crude oil inventories.

Reflecting the strength in the energy sector, the NYSE Arca Natural Gas Index has surged up by 4.7 percent, while the Philadelphia Oil Service Index and the NYSE Arca Oil & Gas Index are up by 3.3 percent and 2.7 percent, respectively.

Steel, gold, computer hardware, and railroad stocks are also seeing considerable strength on the day, moving higher along with most of the other major sectors.

In U.S. economic news, the Commerce Department recently released a report showing that new home sales increased for the second consecutive month in November.

The Commerce Department said new home sales climbed 4.3 percent to an annual rate of 490,000 in November from the revised October rate of 470,000.

A separate report from the University of Michigan showed that consumer sentiment improved by more than initially estimated in December.

The report said the final reading on the consumer sentiment index for December came in at 92.6 compared to the preliminary reading of 91.8 and the final November reading of 91.3.

Before the start of trading, the Commerce Department released a report showing that personal income and spending rose at the same rate in the month of November.

The report said personal income increased by 0.3 percent in November after climbing by 0.4 percent in October. Economists had expected income to edge up by 0.2 percent.

The Commerce Department said personal spending also rose by 0.3 percent in November, while revised data showed sending was unchanged in October. The increase in spending matched economist estimates.

The spending component of the report was inadvertently released last night, well ahead of the scheduled release this morning.

A separate report from the Commerce Department showed that durable goods orders were virtually unchanged in November after surging up by 2.9 percent in October. Orders had been expected to pull back by about 0.5 percent.

Excluding orders for transportation equipment, durable goods orders edged down by 0.1 percent in November after rising by 0.5 percent in October. Economists expected ex-transportation orders to be flat.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher on Wednesday, although the Japanese markets were closed on the day. Hong Kong's Hang Seng Index surged up by 1 percent, while Australia's All Ordinaries Index rose by 0.5 percent.

The major European markets have shown substantial moves to the upside on the day. While the U.K.'s FTSE 100 Index is up by 2.5 percent, the French CAC 40 Index is up by 2.3 percent and the German DAX Index is up by 2.2 percent.

In the bond market, treasuries have moved to the downside, extending the pullback seen in the previous session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 2.9 basis points at 2.268 percent.