Stocks continue to see significant strength in mid-day trading on Tuesday, extending the upward move seen over the course of the two previous sessions. The markets continue to benefit from optimism about the outlook for Europe.
The major averages have seen some further upside in recent trading, reaching new highs for the session. The Dow is up 82.76 points or 0.6 percent at 13,200.27, the Nasdaq is up 34.20 points or 1.1 percent at 3,024.11 and the S&P 500 is up 11.62 points or 0.8 percent at 1,405.85.
The continued strength on Wall Street comes as traders remain optimistic that the European Central Bank will unveil additional measures to address the ongoing debt crisis following the release of disappointing economic data from the region.
Data from Europe showed that the Italian economy shrank in the second quarter, marking the fourth consecutive quarter of contraction. A separate report showed a steeper than expected drop in German factory orders in June.
The focus on Europe comes amid another light on the U.S. economic front, although Federal Reserve Chairman Ben Bernanke is due to speak later in the day.
Bernanke is scheduled to host a town hall event with educators from across the country and will take questions after delivering prepared remarks.
Investors are likely to pay close attention to the question-and-answer portion, hoping that the Fed chief will address the state of the economy and the outlook for monetary policy.
The Federal Reserve is also due to release its report on consumer credit in the month of June at 3 pm ET. Economists expect credit to increase by about $10.3 billion.
Among individual stocks, shares of Tenet Healthcare (THC: Quote) have shown a strong upward move after the hospital operator reported stronger than expected second quarter earnings on an increase in patients. Tenet is currently up by 7.1 percent.
Video game maker THQ Inc. (THQI: Quote) is also turning in a strong performance after reporting a first quarter profit compared to a year-ago loss. The company reported an adjusted loss for the quarter that was narrower than analysts had expected.
Meanwhile, Pfizer (PFE: Quote) and Johnson & Johnson (JNJ: Quote) have moved to the downside after halting studies of an experimental drug for Alzheimer's disease after it failed in a second clinical trial.
Sector News
Natural gas stocks continue to see considerable strength in mid-day trading, with the NYSE Arca Natural Gas Index up by 3 percent. The gain has lifted the index back near the nearly three-month high that it set last Tuesday.
Chesapeake Energy (CHK: Quote) has helped to lead the natural gas sector higher, surging up by 10.9 percent after reporting strong second quarter profit growth. The company also said it expects $7 billion in asset sales during the third quarter.
Significant strength also remains visible among networking stocks, which are extending a recent upward move. The NYSE Arca Networking Index has advanced by 2.7 percent, climbing to its best intraday level in a month. Ciena (CIEN) and Anixter (AXE) are posting notable gains.
Considerable strength has also emerged in the semiconductor sector, as reflected by the 2.5 percent gain being posted by the Philadelphia Semiconductor Index. Electronic storage, health insurance, and brokerage stocks are also posting notable gains.
On the other hand, airline stocks have come under pressure on the day, dragging the NYSE Arca Airline Index down by 1 percent. US Airways (LCC) is posting a particularly steep loss, tumbling by 7.5 percent.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher on Tuesday, adding to yesterday's gains. Japan's Nikkei 225 Index advanced by 0.9 percent, while Hong Kong's Hang Seng Index ended the day up by 0.4 percent.
The major European markets also moved to the upside on the day. While the U.K.'s FTSE 100 Index rose by 0.6 percent, the German DAX Index climbed 0.7 percent and the French CAC 40 Index surged up by 1.5 percent.
In the bond market, treasuries have moved notably lower amid the optimism about Europe. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, has jumped by 7.9 basis points at 1.637 percent.
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by RTT Staff Writer
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