Nasdaq, S&P 500 Climbing To New Record Intraday Highs
(RTTNews) - Stocks have moved mostly higher in morning trading on Wednesday, with the Nasdaq and the S&P 500 reaching new record intraday highs. However, the Dow is bucking the uptrend once again after ending the previous session modestly lower.
In recent trading, the Nasdaq and the S&P 500 have reached new highs for the session. The Nasdaq is up 96.95 points or 0.9 percent at 11,563.43 and the S&P 500 is up 11.34 points or 0.3 percent at 3,454.96, while the Dow is down 26.59 points or 0.1 percent at 28,221.85.
The strength on Wall Street may partly reflect optimism about the outlook for the economy after a report from the Commerce Department showed durable goods orders spiked by much more than expected in the month of July.
The Commerce Department said durable goods orders skyrocketed by 11.2 percent in July after surging up by a revised 7.7 percent in June.
Economists had expected durable goods orders to increase by 4.3 percent compared to the 7.6 percent jump that had been reported for the previous month.
The bigger than expected leap in durable goods orders was primarily due to a sharp increase in orders for transportation equipment, which soared by 35.6 percent.
Excluding the substantial increase in orders for transportation equipment, durable goods orders rose by a much more modest 2.4 percent in July after climbing by 4.0 percent in June. The increase still exceeded estimates for 2.0 percent growth.
The report also said orders for non-defense capital goods excluding aircraft, a reading on business spending, climbed by 1.9 percent in July after surging up by 4.3 percent in June.
"With core orders now back close to pre-pandemic levels, the recovery in business equipment investment looks pretty V-shaped to us," said Michael Pearce, Senior U.S. Economist at Capital Economics.
Nonetheless, traders seem somewhat reluctant to make more significant moves ahead of Federal Reserve Chair Jerome Powell's live-streamed speech at the Jackson Hole economic symposium.
Powell's speech, which is scheduled to begin before the start of trading on Thursday, is likely to be closely watched for clues about the outlook for monetary policy.
Analysts have suggested Powell will signal an increased tolerance for higher inflation, with some predicting he will call for a shift to "average inflation" targeting rather than the long-standing 2 percent target.
Software stocks have shown a substantial move to the upside in morning trading, driving the Dow Jones U.S. Software Index up by 3.6 percent to a new record intraday high.
Newly named Dow component Salesforce.com (CRM) is leading the sector higher, with the business software company soaring by 25.6 percent after reporting better than expected second quarter results and raising its full-year revenue guidance.
Significant strength has also emerged among gold stocks, as reflected by the 1.8 percent jump by the NYSE Arca Gold Bugs Index.
The rally by gold stocks comes amid a sharp increase by the price of the precious metal, with gold for December delivery spiking $23.10 to $1,946.20 an ounce.
On the other hand, airline stocks have come under pressure in morning trading, dragging the NYSE Arca Airline Index down by 1.6 percent.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Wednesday. Japan's Nikkei 225 Index closed just below the unchanged line, while China's Shanghai Composite Index tumbled by 1.3 percent.
Meanwhile, European stocks have moved mostly higher on the day, although the U.K.'s FTSE 100 Index has bucked the uptrend and edged down by 0.2 percent. The French CAC 40 Index is up by 0.5 percent and the German DAX Index is up by 0.6 percent.
In the bond market, treasuries are seeing further downside ahead of Powell's speech on Thursday. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 2.8 basis points at 0.710 percent.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.