Major Averages Posting Strong Gains In Mid-Day Trading - U.S. Commentary

( - After fluctuating early in the session, stocks have moved mostly higher over the course of the trading day on Wednesday. The major averages have all climbed firmly into positive territory following the sell-off seen in recent sessions.

Currently, the major averages are posting strong gains. The Dow is up 294.17 points or 1.4 percent at 22,086.37, the Nasdaq is up 123.91 points or 2 percent at 6,316.83 and the S&P 500 is up 34.69 points or 1.5 percent at 2,385.79.

The strength that has emerged on Wall Street is partly due to bargain hunting, with traders picking up stocks at reduced levels on the heels of recent weakness.

The continued sell-off seen in a holiday-shortened session on Monday dragged the major averages down to their lowest closing levels in well over a year.

Trading activity remains somewhat subdued, however, as many traders remain away from their desks after the Christmas Day holiday on Tuesday.

A lack of major U.S. economic data is also keeping traders on the sidelines, although reports on new home sales, consumer confidence, and pending home sales may attract attention in the coming days.

Nonetheless, the ongoing government shutdown may limit any recovery attempt by the markets, with lawmakers not expected to reconvene until Thursday.

President Donald Trump has stated the government will not reopen until Democrats agree to fund his controversial border wall.

Sector News

Retail stocks have shown a substantial move to the upside on the day, with the Dow Jones Retail Index jumping by 3.1 percent after ending the previous session at its lowest closing level in a year.

The rebound by retail stocks comes after data released by Mastercard ( MA ) showed U.S. holiday retail sales recorded the strongest growth in six years.

Significant strength has also emerged among energy stocks, which are recovering from recent weakness amid a sharp jump by the price of crude oil.

Crude for February delivery is spiking $2.51 to $45.04 a barrel after plunging $3.06 to an eighteen-month closing low of $42.53 a barrel on Monday.

Biotechnology, software, healthcare and transportation stocks are also seeing considerable strength, moving higher along with most of the other major sectors.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower on Wednesday, although Japan'sNikkei 225 Index bucked the downtrend and advanced by 0.8 percent. Many markets in region were closed on the day.

Meanwhile, the major European markets also remained closed on the day as a result of the Boxing Day holiday.

In the bond market, treasuries have shown a lack of direction over the course of the sessions. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by less than a basis point at 2.752 percent.

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