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Nasdaq Climbs To New Record Intraday High

wallstreet oct16 23jun20 lt

Following the advance seen over the course of the previous session, stocks are seeing further upside in morning trading on Tuesday. With the continued upward move, the tech-heavy Nasdaq has reached a new record intraday high.

While the Dow and the S&P 500 have pulled back off their best levels, the Nasdaq is currently climbing to new highs. The Nasdaq is up 109.33 points or 1.1 percent at 10,165.80, the Dow is up 202.85 points or 0.8 percent at 26,227.81 and the S&P 500 is up 27.88 points or 0.9 percent at 3,145.74.

The continued strength on Wall Street has widely been attributed to White House trade adviser Peter Navarro clarifying remarks about the U.S.-China trade deal.

"It's over," Navarro said in response to a question about the trade deal in an interview on Fox News on Monday, adding that the "turning point" was China's failure to warn the United States about the coronavirus outbreak.

However, Navarro subsequently released a statement attempting to clarify his remarks, claiming his initial comments were "taken wildly out of context."

"They had nothing at all to do with the Phase I trade deal, which continues in place," Navarro said. "I was simply speaking to the lack of trust we now have of the Chinese Communist Party after they lied about the origins of the China virus and foisted a pandemic upon the world."

Trump also sought to reassure investors with a post on Twitter declaring the trade deal is "fully intact" and saying he hopes China will "continue to live up to the terms of the Agreement!"

Navarro's initial comments contributed to an overnight nosedive by stock futures but were clarified before impacting regular trading.

Stocks are also benefiting from upbeat economic data out of Europe, with a reading on private sector activity jumping to 47.5 in June from 31.9 in May.

A reading below 50 still indicates contraction, but Simon MacAdam, Senior Global Economist at Capital Economics, noted the readings on activity in developed markets have "come back a long way from their April lows."

"While activity is still considerably below normal levels, the surprising speed of the recovery poses an upside risk to some of our Q2 forecasts," MacAdam said.

In U.S. economic news, the Commerce Department released a report showing a substantial increase in new home sales in the month of May.

The report said new home sales spiked by 16.6 percent to an annual rate of 676,000 in May from a significantly downwardly revised rate of 580,000 in April.

Economists had expected new home sales to jump 2.7 percent to an annual rate of 640,000 from the 623,000 originally reported for the previous month.

Extending the rally seen in the two previous sessions, gold stocks have shown another substantial move to the upside in morning trading. The NYSE Arca Gold Bugs Index has surged up by 3.1 percent to its best intraday level in a month.

The continued strength among gold stocks comes as the price of the precious metal is seeing further upside, with gold for August delivery jumping $16.10 to $1,782.50 an ounce.

Significant strength has also emerged among steel stocks, as reflected by the 2.2 percent spike by the NYSE Arca Steel Index.

Banking stocks have also shown a strong move to the upside in morning trading, driving the KBW Bank Index up by 1.5 percent.

Energy, brokerage and biotechnology stocks are also seeing notable strength, moving higher along with most of the other major sectors.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Tuesday. Japan's Nikkei 225 Index rose by 0.5 percent, while Hong Kong's Hang Seng Index surged up by 1.6 percent.

The major European markets have also shown strong moves to the upside on the day. While the German DAX Index has soared by 2.2 percent, the French CAC 40 Index is up by 1.3 percent and the U.K.'s FTSE 100 Index is up by 1.1 percent.

In the bond market, treasuries are seeing modest weakness after closing nearly flat for two straight sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 1.4 basis points at 0.718 percent.

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