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Stocks Open Higher On Final Trading Day Of The Year - U.S. Commentary


Stocks have moved mostly higher in morning trading on Monday following the roller-coaster ride seen in the previous week. After ending last Friday's trading mixed, the major averages have all climbed into positive territory.

The major averages have pulled back off their highs of the session but are currently holding on to gains. The Dow is up 150.89 points or 0.7 percent at 23,213.29, the Nasdaq is up 15.65 points or 0.2 percent at 6,600.17 and the S&P 500 is up 8.43 points or 0.3 percent at 2,494.17.

Early buying interest was generated in reaction to optimism about a potential U.S.-China trade deal following comments from President Donald Trump.

In a post on Twitter on Saturday, Trump he had a "long and very good" telephone call with Chinese President Xi Jinping.

"Deal is moving along very well," Trump tweeted. "If made, it will be very comprehensive, covering all subjects, areas and points of dispute. Big progress being made!"

The tweet has generated some positive sentiment, although skepticism about the likelihood of a long-term trade deal is likely to remain.

Traders seem reluctant to make more significant moves amid a lack of major U.S. economic data, with some traders also away from their desks ahead of the New Year's Day holiday on Tuesday.

Biotechnology stocks have shown a significant move to the upside in morning trading, driving the NYSE Arca Biotechnology Index up by 1.7 percent. The index continues to recover after ending last Monday's trading at its lowest closing level in well over a year.

Considerable strength has also emerged among healthcare stocks, while oil service and tobacco stocks are showing notable moves to the downside.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Monday, with many markets across the region closed for New Year's Eve. Hong Kong's Hang Seng Index surged up by 1.3 percent, while Australia's S&P/ASX 200 Index slipped by 0.1 percent.

The major European markets also ended the day mixed, although several markets were closed. While the U.K.'s FTSE 100 Index edged down by 0.1 percent in an abbreviated trading session, the French CAC 40 Index jumped by 1.1 percent.

In the bond market, treasuries are seeing modest strength after ending last Friday's trading roughly flat. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 1.6 basis points at 2.720 percent.

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