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Stocks Close Higher As Fed Announcement Looms - U.S. Commentary


Following the mixed performance seen last week, stocks moved mostly higher during trading on Monday. With the upward move, the Dow and the S&P 500 reached new record closing highs.

The Dow rose 56.87 points or 0.2 percent to 24,386.03, the Nasdaq advanced 35.00 points or 0.5 percent to 6,875.08 and the S&P 500 climbed 8.49 points or 0.3 percent to 2,659.99.

Traders seemed somewhat reluctant to make significant moves ahead of the Federal Reserve's monetary policy announcement on Wednesday.

With the Fed widely expected to raise interest rates by a quarter point, traders are likely to keep a close eye on the accompanying statement as well as outgoing Fed Chair Janet Yellen's press conference for clues about the outlook for future rate hikes.

Economic reports on producer and consumer prices, retail sales, and industrial production may also attract some attention this week.

Energy stocks saw considerable strength on the day, moving higher an increase by the price of crude oil. Crude for January delivery climbed $0.67 to $57.36 a barrel.

Reflecting the strength in the energy sector, the NYSE Arca Natural Gas Index shot up by 1.5 percent and the Philadelphia Oil Service Index jumped by 1.5 percent.

Telecom and software stocks are also saw significant strength, while most of the other major sectors showed only modest moves on the day.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Monday. Japan's Nikkei 225 Index climbed by 0.6 percent, Hong Kong's Hang Seng Index jumped by 1.1 percent.

Meanwhile, the major European markets turned a mixed performance on the day. While the U.K.'s FTSE 100 Index advanced by 0.8 percent, the French CAC 40 Index and the German DAX Index both fell by 0.2 percent.

In the bond market, treasuries pulled back after seeing initial strength to end the day roughly flat. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, inched up by less than a basis point to 2.385 percent.

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