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Stocks Extending Recent Upward Trend In Morning Trading - U.S. Commentary


Stocks have moved moderately higher in morning trading on Tuesday, extending the upward trend seen over the past few sessions. The major averages are all moving higher for the sixth time in the past seven sessions.

Currently, the major averages are off their highs of the session but still in positive territory. The Dow is up 126.78 points or 0.5 percent at 26,040.88, the Nasdaq is up 21.02 points or 0.3 percent at 7,735.50 and the S&P 500 is up 9.78 points or 0.4 percent at 2,842.72.

The markets continue to benefit from recent upward momentum, which has lifted the Nasdaq and the S&P 500 to their best levels in over five months.

Optimism about U.S.-China trade talks has contributed to the buying interest on Wall Street along with indications the U.S. economy is holding up relatively well amid a global slowdown.

Trading activity is somewhat subdued, however, as the Federal Reserve's upcoming monetary policy decision keeps some traders on the sidelines.

The Fed is widely expected to leave interest rates unchanged on Wednesday, although traders are likely to keep a close eye on the accompanying statement for clues about the outlook for rates.

The central bank's economic projections and Fed Chairman Jerome Powell's subsequent press conference are also likely to be in focus.

Traders have largely shrugged off a report from the Commerce Department showing new orders for U.S. manufactured goods edged only slightly higher in the month of January.

The Commerce Department said factory orders inched up by 0.1 percent in January, matching the 0.1 percent uptick in December. Economists had expected orders to rise by 0.3 percent.

Semiconductor stocks are turning in some of the market's best performances in morning trading, resulting in a 1.3 percent gain by the Philadelphia Semiconductor Index. The index has reached a six-month intraday high.

Notable strength is also visible among steel stocks, while most of the other major sectors are showing more modest moves on the day.

In overseas trading, most stock markets across the Asia-Pacific region moved modestly lower during trading on Tuesday. Japan's Nikkei 2225 Index edged down by 0.1 percent, while China's Shanghai Composite Index dipped by 0.2 percent.

Meanwhile, the major European markets have moved to the upside on the day. While the German DAX Index has jumped by 1.4 percent, the U.K.'s FTSE 100 Index and the French CAC 40 Index are both up by 0.5 percent.

In the bond market, treasuries are extending the modest pullback seen in the previous session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 1.9 basis points at 2.621 percent.

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