U.S. Stocks Show Strong Upward Move, Nasdaq Reaches New Record Closing High

(RTTNews) - Stocks moved sharply higher during trading on Tuesday, extending the rebound from last Friday's sell-off that was seen in the previous session. With the strong upward move, the tech-heavy Nasdaq reached a new record closing high.

The major averages gave back some ground going into the close but held on to substantial gains. The Dow jumped 407.82 points or 1.4 percent to 28,807.63, the Nasdaq soared 194.57 points or 2.1 percent to 9,467.97 and the S&P 500 surged up 48.67 points or 1.5 percent to 3,297.59.

The rally on Wall Street came on the heels of strength in overseas markets, with Chinese stocks rebounding following the nosedive seen as trading resumed on Monday.

Traders seem to expect China to announce additional stimulus to boost the economy amid the fallout from the coronavirus outbreak.

The coronavirus has now claimed 425 lives and infected more than 20,000 people in mainland China, with efforts to contain the outbreak expected to stifle the Chinese economy.

The Nasdaq benefited from a 13.7 percent spike by shares of Tesla (TSLA), with the electric car maker soaring to a new record high.

Meanwhile, traders largely shrugged off a slump by shares of Google parent Alphabet (GOOGL), which tumbled by 2.5 percent.

After the close of trading on Monday, Alphabet reported better than expected fourth quarter earnings but on revenues that missed analyst estimates.

In U.S. economic news, the Commerce Department released a report showing new orders for U.S. manufactured goods spiked by more than anticipated in the month of December.

The Commerce Department said factory orders surged up by 1.8 percent in December after tumbling by a revised 1.2 percent in November.

Economists had expected factory orders to jump by 1.2 percent compared to the 0.7 percent decrease originally reported for the previous month.

Sector News

Steel stocks showed a substantial move to the upside on the day, with the NYSE Arca Steel Index spiking by 3.2 percent. The index continued to rebound from the three-month closing low set last Friday.

Considerable strength was also visible among semiconductor stocks, as reflected by the 3.1 percent jump by the Philadelphia Semiconductor Index.

Computer hardware, software, and biotechnology stocks also saw significant strength, contributing to the rally by the tech-heavy Nasdaq.

Most of the other major sectors also moved notably higher on the day, although gold stocks bucked the uptrend amid a sharp drop by the price of the precious metal.

With gold for April delivery plunging $26.90 to $1,555.50 an ounce, the NYSE Arca Gold Bugs Index tumbled by 2.5 percent.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Tuesday. Japan's Nikkei 225 Index rose by 0.5 percent, while China's Shanghai Composite Index surged up by 1.3 percent.

The major European markets also showed strong moves to the upside on the day. While the U.K.'s FTSE 100 Index has jumped by 1.6 percent, the German DAX Index and the French CAC 40 Index both spiked by 1.8 percent.

In the bond market, treasuries moved notably lower after ending the previous session nearly unchanged. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, advanced by 8.3 basis points to 1.603 percent.

Looking Ahead

Trading on Wednesday may be impacted by reaction to some key U.S. economic news, including reports on private sector employment, the trade deficit, and service sector activity.

On the earnings front, Disney (DIS), Ford (F), Allstate (ALL), and Snapchat parent Snap (SNAP) are among the companies releasing their quarterly results after the close of today's trading.

General Motors (GM), Humana (HUM), and Spotify (SPOT) are also among the companies due to report their results before the start of trading on Wednesday.