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U.S. Stocks Hovering In Positive Territory In Mid-Day Trading

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After an early move to the upside, stocks remain mostly positive in mid-day trading on Friday. With the upward move on the day, the Dow and the S&P 500 have reached new record intraday highs.

Currently, the major averages are hovering firmly in positive territory. The Dow is up 138.18 points or 0.5 percent at 27,226.26, the Nasdaq is up 30.79 points or 0.4 percent at 8,226.83 and the S&P 500 is up 5.88 points or 0.2 percent at 3,005.79.

The markets continue to benefit from renewed optimism about the Federal Reserve lowering interest rates as soon as its next meeting later this month.

Congressional testimony from Fed Chairman Jerome Powell indicating crosscurrents, such as trade tensions and concerns about global growth, have continued to weigh on the U.S. economic outlook helped spark the resurgence in optimism about a rate cut.

Powell's remarks have triggered an upward trend on Wall Street that lifted the Dow above the 27,000 level for the first time ever.

Trading activity has remained somewhat subdued, however, as traders brace for the unofficial start of earnings season next week.

Citigroup (C), Goldman Sachs (GS), Johnson & Johnson (JNJ), JPMorgan (JPM), Wells Fargo (WFC), IBM (IBM), Netflix (NFLX), Microsoft (MSFT), and American Express (AXP) are among the slew of companies due to report their quarterly results.

Meanwhile, traders have largely shrugged off a report from the Labor Department showing U.S. producer prices unexpectedly edged higher in the month of June.

The Labor Department said its producer price index for final demand inched up by 0.1 percent in June, matching the uptick seen in May. Economists had expected producer prices to come in unchanged.

Excluding food and energy prices, core producer prices climbed by 0.3 percent in June after rising by 0.2 percent in May. Core prices had been expected to show another 0.2 percent increase.

"The small gain in producer prices in June suggests the increase in tariffs on $200bn of imports from China has yet to generate a pick-up in inflation and confirms that underlying domestic inflationary pressures remain subdued," said Michael Pearce, Senior U.S. Economist at Capital Economics.

He added, "That should help ease any fears, following the June CPI figures released yesterday, that underlying consumer price inflation will rise back above 2%."

Sector News

Transportation stocks continue to turn in some of the market's best performances in mid-day trading, with the Dow Jones Transportation Average jumping by 1.7 percent. The average remains on pace to end the session at a nearly two-month closing high.

Significant strength also remains visible among semiconductor stocks, as reflected by the 1.5 percent gain being posted by the Philadelphia Semiconductor Index.

Networking and chemical stocks are also seeing notable strength on the day, while pharmaceutical and biotechnology stocks are extending the sell-off seen in the previous session.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Friday. Japan's Nikkei 225 Index edged up by 0.2 percent, while China's Shanghai Composite Index rose by 0.4 percent.

Meanwhile, the major European markets turned mixed over the course of the session. While the French CAC 40 Index climbed by 0.4 percent, the U.K.'s FTSE 100 Index and the German DAX Index both edged down by 0.1 percent.

In the bond market, treasuries have climbed back near the unchanged line after seeing early weakness. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by less than a basis point at 2.125 percent.

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