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U.S. Stocks Fluctuate Before Closing Firmly Positive

wallstreet higher 050119 08jul20 lt

Stocks fluctuated over the course of the trading day on Wednesday before eventually finishing the session notably higher. The Nasdaq more than offset the pullback seen on Tuesday, ending the day at a new record closing high.

The major averages all closed firmly in positive territory, although the tech-heavy Nasdaq outperformed its counterparts. While the Nasdaq surged up 148.61 points or 1.4 percent to 10,492.50, the Dow climbed 177.10 points or 0.7 percent to 26,067.28 and the S&P 500 advanced 24.62 points or 0.8 percent to 3,169.94.

The choppy trading seen for much of the session came amid relatively light volume, with a lack of major U.S. economic news keeping some traders on the sidelines.

The economic calendar remains relatively light throughout the week, although reports on weekly jobless claims and producer price inflation may attract some attention in the coming days.

Nonetheless, the path of least resistance for the markets remains to the upside, as economic optimism continues to overshadow the recent spike in coronavirus cases.

The Nasdaq continued to benefit from strong gains by tech giants like Apple (AAPL), which surged up by 2.3 percent after Deutsche Bank raised its price target on the company's stock to $400 per share from $380 per share.

Notable gains by Amazon (AMZN), Netflix (NFLX) and Facebook (FB) also helped lift the tech-heavy index to a new record closing high.

Shares of National General Holdings (NGHC) also soared after the insurance company agreed to be acquired by Allstate (ALL) for approximately $4 billion or $34.50 per share in cash.

Oil service provider TechnipFMC (FTI) also moved sharply higher after signing a more than $1 billion contract for the construction of a new hydrocracking complex at an Assiut National Oil Processing refinery in Egypt.

Meanwhile, shares of Levi Strauss (LEVI) came under pressure after the jeans maker said it expects its business will continue to be significantly adversely impacted by the coronavirus pandemic for at least the balance of 2020.

Sector News

Gold stocks showed a substantial move to the upside on the day, driving the NYSE Arca Gold Bugs Index up by 3.1 percent to its best closing level in over seven years.

The rally by gold stocks came amid a continued increase by the price of the precious metal, with gold for August delivery climbing $10.70 to a nearly nine-year closing high of $1,820.60 an ounce.

Significant strength was also visible among housing stocks, as reflected by the 2.7 percent spike by the Philadelphia Housing Sector Index.

Software, brokerage, computer hardware and semiconductor stocks also saw considerable strength, while notable weakness emerged among chemical stocks.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in another mixed performance during trading on Wednesday. Japan's Nikkei 225 Index slid by 0.8 percent, while China's Shanghai Composite Index surged up by 1.7 percent.

Meanwhile, the major European markets all moved to the downside for the second straight day. While the French CAC 40 Index tumbled by 1.2 percent, the German DAX Index slumped by 1 percent and the U.K.'s FTSE 100 Index fell by 0.6 percent.

In the bond market, treasuries recovered from early weakness to end the session nearly unchanged. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, inched up by less than a basis point to 0.653 percent.

Looking Ahead

Following a couple quiet days on the U.S. economic front, trading on Thursday may be impacted by reaction to the Labor Department's weekly jobless claims report.

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