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Dow Rejoins Nasdaq And S&P 500 Firmly In Positive Territory - U.S. Commentary

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Stocks have fluctuated over the course of the session on Friday but are mostly higher in mid-day trading. While the Dow briefly dipped below the unchanged line earlier in the session, the blue chip index has rejoined the Nasdaq and the S&P 500 in positive territory.

In recent trading, the major averages have reached new highs for the session. The Dow is up 153.49 points or 0.6 percent at 25,863.43, the Nasdaq is up 67.95 points or 0.9 percent at 7,698.86 and the S&P 500 is up 16.28 points or 0.6 percent at 2,824.76.

The strength on Wall Street comes amid optimism about U.S.-China trade talks as well as indications of more Chinese economic stimulus.

Chinese Premier Li Keqiang pledged support for the slowing economy during his annual news conference at the end of the National People's Congress.

Li said the country could use reserve requirements and interest rates to prevent a sharper deceleration in the world's second-largest economy.

However, the positive sentiment was partly offset by a report from the Federal Reserve showing industrial production rose by much less than expected in the month of February.

The Fed said industrial production inched up by 0.1 percent in February after falling by a revised 0.4 percent in January.

Economists had expected production to climb by 0.4 percent compared to the 0.6 percent drop originally reported for the previous month.

The uptick in production came as a spike in utilities output and an increase in mining output was largely offset by a continued drop in manufacturing output.

"The further decline in manufacturing output in February confirms that the global industrial slowdown is now weighing more heavily on U.S. producers," said Andrew Hunter, Senior U.S. Economist at Capital Economics.

He added, "With tighter fiscal and monetary policy constraining domestic demand, the weaker external environment is another reason to expect a sustained slowdown in economic growth this year."

A separate report from the New York Fed showed an unexpected slowdown in regional manufacturing growth, although the University of Michigan also released a report showing a bigger than expected improvement in consumer sentiment in March.

Sector News

Semiconductor stocks continue to see substantial strength in mid-day trading, with the Philadelphia Semiconductor Index spiking by 3 percent. The index reached a six-month intraday high earlier in the session.

Broadcom (AVGO) is leading the sector higher after the chipmaker reported fiscal first quarter earnings that exceeded analyst estimates.

Considerable strength is also visible among computer hardware stocks, as reflected by the 1.5 percent gain being posted by the NYSE Arca Computer Hardware Index.

Networking and steel stocks are also seeing significant strength on the day, while notable weakness has emerged among natural gas stocks.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Friday. Japan's Nikkei 225 Index advanced by 0.8 percent, while China's Shanghai Composite Index jumped by 1 percent.

The major European markets have also moved to the upside on the day. While the French CAC 40 Index has climbed by 0.8 percent, the U.K.'s FTSE 100 Index and the German DAX Index are up by 0.6 percent and 0.5 percent, respectively.

In the bond market, treasuries have pulled back off their best levels but remain in positive territory. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 2.8 basis points at 2.602 percent.

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