Stocks saw some volatility over the course of the trading day on Wednesday before ending the session mostly higher. The higher close on the day extended the recent upward move by the markets, with the Dow and the S&P 500 once again reaching new record highs.
The major averages moved to the upside going into the close, ending the day in positive territory. The Dow rose 60.44 points or 0.4 percent to 15,275.69, the Nasdaq climbed 9.01 points or 0.3 percent to 3,471.62 and the S&P 500 advanced 8.44 points or 0.5 percent to 1,658.78.
The choppy trading seen for most of the session came as traders digested a mixed batch of U.S. economic data, although stocks continued to benefit from the recent upward momentum on Wall Street.
Some buying interest was generated by the release of a better than expected report on homebuilder confidence in the month of May.
The National Association of Home Builders said its housing market index climbed to 44 in May from a downwardly revised 41 in April. Economists had expected the index to rise to 43.
The better than expected housing data offset negative sentiment generated by a separate report from the Federal Reserve showing a bigger than expected drop in industrial production in April.
The report said production fell by 0.5 percent in April following a 0.3 percent increase in March, while economists had expected a more modest 0.2 percent drop.
Jennifer Lee, senior economist at BMO Capital, said, "At the intersection of the U.S. economy, the housing market is still flashing a green light, while business production is flashing yellow."
A separate report from the New York Federal Reserve showed an unexpected contraction in regional manufacturing activity in May, while the Labor Department reported a drop in producer prices in April that matched estimates.
Among individual stocks, Macy's (M) showed a notable upward move after the department store operator reported better than expected first quarter earnings and raised its dividend.
Scientific instruments maker Agilent (A) also gained ground after reporting first quarter earnings that fell year-over-year but came in above analyst estimates.
On the other hand, shares of Deere (DE) came under pressure after the farm machinery maker reported better than expected quarterly results but provided disappointing guidance.
Sector News
Trucking stocks showed a notable move to the upside over the course of the trading day, resulting in a 1.6 percent gain by the Dow Jones Trucking Index. YRC Worldwide (YRCW) posted a standout gain, surging up by 21.5 percent.
Significant strength was also visible among airline stocks, as reflected by the 1.5 percent gain posted by the NYSE Arca Airline Index. The strength in the sector came on the heels of upbeat comments from Morgan Stanley, which said it continues to expect airline stocks to grind higher in the short-term.
Banking stocks also moved notably higher on the day, resulting in a 1.1 percent gain by the KBW Bank Index. The gain lifted the index to its best closing level in well over four years.
Meanwhile, gold stocks saw substantial weakness, moving lower along with the price of the precious metal. With gold for June delivery tumbling $28.30 to $1,396.20 an ounce, the NYSE Arca Gold Bugs Index plummeted by 4.7 percent.
Biotechnology and steel stocks also came under pressure on the day, partly offsetting the strength seen in the aforementioned sectors.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Wednesday. Japan's Nikkei 225 Index surged up by 2.3 percent to a five-year high, while Hong Kong's Hang Seng Index advanced by 0.5 percent.
The major European markets also moved to the upside on the day. While the U.K.'s FTSE 100 Index inched up by 0.1 percent, the German DAX Index and the French CAC 40 Index rose by 0.3 percent and 0.4 percent, respectively.
In the bond market, treasuries showed a lack of direction over the course of the session before closing modestly higher. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by less than a basis point to 1.943 percent.
Looking Ahead
Earnings news is likely to impact trading on Thursday, with tech giant Cisco (CSCO) releasing its third quarter results after the close of today's trading, while retail giant Wal-Mart (WMT) is due to report its first quarter results before the start of tomorrow's trading.
Trading could also be impacted by another slew of U.S. economic data, including reports on weekly jobless claims, housing starts, and Philadelphia-area manufacturing activity.
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