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Major Averages Rise To New Record Closing Highs - U.S. Commentary


Following the mixed performance seen in the previous session, stocks moved mostly higher during trading on Tuesday. With the upward move on the day, the major averages once again climbed to new record closing highs.

The major averages finished the session in positive territory but off their best levels of the day. The Dow rose 102.80 points or 0.4 percent to 25,385.80, the Nasdaq inched up 6.19 points or 0.1 percent to 7,163.58 and the S&P 500 edged up 3.58 points or 0.1 percent to 2,751.29.

Stocks continued to benefit from recent upward momentum, which has lifted the markets to record highs amid optimism about the economic outlook.

Continued strength seen in the overseas markets on the day also contributed to the buying interest on Wall Street.

Overall trading activity remains somewhat subdued, however, with a lack of major U.S. economic data keeping some traders on the sidelines.

Traders may have been reluctant to make more significant moves ahead of the release of closely watched data on retail sales and producer and consumer prices later in the week.

Financial giants JPMorgan Chase (JPM) and Wells Fargo (WFC) are also due to report their quarterly results on Friday as earnings season gets underway.

Sector News

Biotechnology stocks showed a substantial move to the upside over the course of the trading session, driving the NYSE Arca Biotechnology Index up by 3.3 percent. With the jump, the index reached its best closing level in well over two years.

Alder BioPharmaceuticals (ALDR), Global Blood Therapeutics (GBT), and Nektar Therapeutics (NKTR) posted standout gains.

Significant strength was also visible among healthcare stocks, as reflected by the 1.1 percent gain posted by the Dow Jones Health Care Index. The index ended the session at a record closing high.

Trucking, railroad, and financial stocks also saw notable strength on the day, while gold, telecom, and commercial real estate stocks moved to the downside.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Tuesday. Japan's Nikkei 225 Index advanced by 0.6 percent, while Hong Kong's Hang Seng Index rose by 0.4 percent.

The major European markets also moved to the upside on the day. While the German DAX Index inched up by 0.1 percent, the U.K.'s FTSE 100 Index and the French CAC 40 Index climbed by 0.5 percent and 0.7 percent, respectively.

In the bond market, treasuries moved notably lower after ending the previous session roughly flat. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, increased by 6.6 basis points to a nearly ten-month closing high of 2.546 percent.

Looking Ahead

Reports on import and export prices and wholesale inventories may attract some attention on Wednesday, although traders are likely to look ahead to the more closely watched due later in the week.

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