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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 Friday, although buying interest has remained relatively subdued. The markets have benefited from a positive reaction to the latest batch of U.S. economic data.

Currently, the major averages are all in positive territory, although the Nasdaq is only just above the unchanged line. While the Nasdaq is up 4.08 points or 0.1 percent at 3,099.44, the Dow is up 53.66 points or 0.4 percent at 13,199.48 and the S&P 500 is up 4.99 points or 0.4 percent at 1,408.27.

The modest strength that has emerged on Wall Street comes on the last trading day of the first quarter, with some institutional investors looking to do some window dressing.

Buying interest has also been generated by news that Eurozone finance ministers decided to raise the combined size of the region's bailout funds to prevent the possible spillover of the debt crisis in some member states.

Additionally, the Commerce Department released a report showing a notable increase in personal spending in the month of February, although personal income rose by less than expected.

The report showed that personal spending rose by 0.8 percent in February following an upwardly revised 0.4 percent increase in January. Economists had expected spending to increase by 0.6 percent compared to the 0.2 percent growth that had been reported for the previous month.

Meanwhile, personal income edged up by 0.2 percent in February, matching the downwardly revised increase seen in the previous month. Personal income had been expected to increase by 0.4 percent.

A separate report from Reuters and the University of Michigan showed that consumer sentiment unexpectedly improved in the month of March.

The report showed that the consumer sentiment index for March was upwardly revised to a reading of 76.2 from the preliminary reading of 74.3. With the upward revision, the March reading is up from 75.3 in February and above economists' estimate of 75.0.

On the other hand, the Institute for Supply Management - Chicago also released a report showing a slowdown in the pace of growth in regional business activity.

The ISM Chicago said its business barometer fell to 62.2 in March from 64.0 in February, although a reading above 50 still indicates an increase in business activity. Economists had expected the index to show a more modest drop to a reading of 63.0.

Sector News

While most of the major sectors are showing only modest moves, health insurance stocks have shown a strong move to the upside. Reflecting the strength in the sector, the Morgan Stanley Healthcare Payor Index has jumped 1.8 percent, reaching a record intraday high.

Health insurance stocks have moved sharply higher over the past two days after the Supreme Court wrapped up three days of arguments on the healthcare reform law.

Notable strength has also emerged among oil service stocks, as reflected by the 1.4 percent gain being posted by the Philadelphia Oil Service Index. The strength in the sector comes amid a modest increase by the price of crude oil.

Biotechnology and commercial real estate stocks are also seeing moderate strength on the day, while some weakness is visible among airline and electronic storage stocks.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Friday. While Japan's Nikkei 225 Index fell by 0.3 percent, China's Shanghai Composite Index ended the day up by 0.5 percent.

Meanwhile, the major European markets all moved to the upside on the day. The U.K.'s FTSE 100 Index rose by 0.5 percent, while the German DAX Index and the French CAC 40 Index advanced by 1 percent and 1.3 percent, respectively.

In the bond market, treasuries are lingering near the unchanged ling after trending higher in recent sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by less than a basis point at 2.152 percent.

by RTT Staff Writer

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