Stocks have once again moved in opposite directions in morning trading on Monday following the mixed performance seen last week. While the Dow is pulling back further off its recent highs, the tech-heavy Nasdaq has shown a strong move to the upside.
The Dow has climbed well off its worst levels in recent trading but currently remains down 55.49 points or 0.2 percent at 26,616.46. Meanwhile, the Nasdaq is up 122.28 points or 1.2 percent at 10,625.47 and the S&P 500 is up 9.89 points or 0.3 percent at 3,234.62.
The mixed performance on Wall Street comes as traders continue to weigh the recent surge in coronavirus cases in certain states against continued optimism about the economic outlook.
Florida reported 12,523 new coronavirus cases on Saturday, reflecting the fifth consecutive day the state reported more than new 10,000 infections.
Positive results from trials of experimental COVID-19 vaccines by Oxford University and AstraZeneca (AZN) and Pfizer (PFE) and BioNTech (BNTX) have helped offset any negative sentiment generated by the latest news.
A lack of major U.S. economic data may be keeping some traders on the sidelines as they wait for more upbeat news to support their unrelenting optimism.
The economic calendar remains relatively light throughout the week, although traders are likely to keep an eye on the weekly jobless claims report as well as data on new and existing home sales.
Earnings news may take the spotlight in the coming days, with IBM Corp. (IBM), Coca-Cola (KO), Microsoft (MSFT), AT&T (T), Twitter (TWTR), and Intel (INTC) among a slew of companies due to report their quarterly results.
The modest drop by the Dow partly reflects notable losses by Walgreens Boots Alliance (WBA), Raytheon Technologies (RTN) and Chevron (CVX).
Chevron is moving lower after announcing an agreement to acquire Nobel Energy (NBL) in an all-stock transaction valued at $5 billion, or $10.38 per share.
Meanwhile, the Nasdaq is benefiting from a strong gain by Amazon (AMZN), which is moving higher after Goldman Sachs and Jefferies both raised their price targets for the online retail giant to $3,800 per share.
Many of the major sectors are showing only modest moves, although gold stocks have moved sharply higher in morning trading. The NYSE Arca Gold Bugs Index has surged up by 3 percent to its best intraday level in over seven years.
The rally by gold stocks comes amid an increase by the price of the precious metal, with gold for August delivery climbing $8.90 to $1,818.90 an ounce.
Software and biotechnology stocks are also seeing considerable strength on the day, contributing to the advance by the tech-heavy Nasdaq.
On the other hand, tobacco stocks have shown a substantial move to the downside, dragging the NYSE Arca Tobacco Index down by 2.6 percent.
Significant weakness has also emerged among airline stocks, as reflected by the 2.3 percent slump by the NYSE Arca Airline Index.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Monday. Japan’s Nikkei 225 Index inched up by 0.1 percent and China’s Shanghai Composite Index soared by 3.1 percent, while Australia’s S&P/ASX 200 Index fell by 0.5 percent.
The major European markets have also turned mixed on the day. While the U.K.’s FTSE 100 Index has fallen by 0.6 percent, the French CAC 40 Index is up by 0.3 percent and the German DAX Index is up by 0.8 percent.
In the bond market, treasuries have moved back to the upside after turning lower over the course of the previous session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 1.9 basis points at 0.609 percent.
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