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Stocks Moving Mostly Higher In Mid-Day Trading - U.S. Commentary

Stocks have moved mostly higher over the course of the trading day on Monday, although buying interest has remained somewhat subdued. The markets are extending the upward move seen last week despite a relatively light news day.

The major averages have seen some further upside in recent trading, reaching new highs for the session. The Dow is up 20.10 points or 0.2 percent at 13,252.72, the Nasdaq is up 21.15 points or 0.7 percent at 3,076.41 and the S&P 500 is up 6.24 points or 0.4 percent at 1,410.41.

The strength that has emerged on Wall Street is partly due to the positive sentiment generated by tech giant Apple's (AAPL) announcement of plans to initiate a dividend and a share repurchase program.

Apple said it plans to initiate a quarterly dividend of $2.65 per share sometime in the fourth quarter of fiscal 2012. The company's board also authorized a $10 billion share repurchase program commencing in fiscal 2013.

Shares of Apple are up by 1.8 percent on the news, climbing towards the record intraday high just above $600 a share set last Thursday.

UPS (UPS) is also turning in a strong performance on the day after the delivery giant announced that it has agreed to acquire TNT Express N.V. for 9.50 euros per share. The transaction values TNT Express at approximately 5.16 billion euros, or $6.8 billion.

The transaction, which would be the largest ever by UPS in its history, would give UPS an even greater advantage over its rival FedEx (FDX) in Europe. Shares of UPS are up by 3.5 percent.

Meanwhile, traders have largely shrugged off the release of a report from the National Association of Home Builders showing that its homebuilder confidence index unexpectedly came in unchanged in March.

The report showed that the NAHB/Wells Fargo Housing Market Index came in at 28 in March, unchanged from the downwardly revised reading for February. Economists had expected the index to edge up to 30 from the 29 originally reported for the previous month.

While the index came in below economist estimates, it is still holding at its best level since a matching reading in June of 2007.

Housing data is likely to be in focus throughout the week, with reports on housing starts and new and existing home sales also due to be released later in the week.

Sector News

Extending a recent upward move, banking stocks have shown a strong move to the upside over the course of the session. Reflecting the strength in the banking sector, the KBW Bank Index has advanced by 1.6 percent to a ten-month intraday high.

Citigroup (C) and KeyCorp (KEY) are turning in two of the banking sector's best performances, climbing by 4.4 percent and 3 percent, respectively.

Steel stocks are also seeing considerable strength on the day, resulting in a 1.7 percent gain by the NYSE Arca Steel Index. With the gain, the index has risen to its best intraday level in over a month.

Brokerage, telecom, and computer hardware stocks are also posting notable moves, moving higher along with most of the major sectors.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in another mixed performance on Monday. Japan's Nikkei 225 Index edged up by 0.1 percent, while Hong Kong's Hang Seng Index ended the day down by 1 percent.

Meanwhile, the major European markets have all moved to the downside on the day. While the French CAC 40 Index has slid by 0.5 percent, the German DAX Index and the U.K.'s FTSE 100 Index have edged down by 0.2 percent and 0.1 percent, respectively.

In the bond market, treasuries are seeing modest weakness, extending a recent downward move. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 1.6 basis points at 2.314 percent.

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

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