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Major Averages Climb To Record Highs - U.S. Commentary

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Stocks moved mostly over the course of the trading session on Monday, adding to the gains posted last week. With the upward move on the day, the major averages reached new record closing highs.

The major averages ended the day firmly in positive territory. The Dow advanced 152.51 points or 0.7 percent to 22,557.60, the Nasdaq rose 20.76 points or 0.3 percent to 6,516.72, the S&P 500 climbed 9.76 points or 0.4 percent to 2,529.12.

The strength on Wall Street came following the releasing of a report from the Institute for Supply Management showing an unexpected acceleration in the rate of growth in manufacturing activity in the month of September.

The ISM said its purchasing managers index climbed to 60.8 in September from 58.8 in August, with a reading above 50 indicating growth in the manufacturing sector. Economists had expected the index to dip to 50.8.

"Comments from the panel reflect expanding business conditions, with new orders, production, employment, order backlogs and export orders all growing in September," said Timothy R. Fiore, Chair of the ISM Manufacturing Business Survey Committee.

A separate report released by the Commerce Department showed construction spending in the U.S. increased by more than expected in the month of August.

The Commerce Department said construction spending climbed 0.5 percent to $1.218 trillion in August after plunging by 1.2 percent to $1.212 trillion in July. Economists had expected spending to rise by 0.2 percent.

However, news on Wall Street largely took a backseat following a mass shooting in Las Vegas, which has left more than 50 dead and more than 400 wounded.

Biotechnology stocks showed a significant move to the upside, driving the NYSE Arca Biotechnology Index up by 1.9 percent. With the increase, the index has reached its best closing level in over two years.

Endocyte (ECYT) posted a substantial gain after announcing the completion of an exclusive worldwide license of PSMA-617 from ABX GmbH.

Networking, chemical and electronic storage stocks also saw significant strength, while oil service and railroad stocks showed notable moves to the downside,

In overseas trading, stock markets across the Asia-Pacific region moved to the upside during trading on Monday. Japan's Nikkei 225 Index rose by 0.2 percent, while Hong Kong's Hang Seng Index climbed by 0.5 percent.

The major European markets also moved to the upside on the day. While the U.K.'s FTSE 100 Index jumped by 0.9 percent, the German DAX Index and the French CAC 40 Index climbed by 0.6 percent and 0.4 percent.

In the bond market, treasuries have fluctuated over the course of the morning and are currently lingering near the unchanged line. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by less than a basis point at 2.330 percent.

by RTT Staff Writer

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