Major Averages Posting Modest Gains In Mid-Day Trading - U.S. Commentary

(RTTNews) - Stocks are seeing modest strength in mid-day trading on Tuesday after showing a lack of direction earlier in the session. The major averages are moving higher for the fourth straight session, largely offsetting the sell-off seen last Wednesday.

Currently, the major averages are hovering in positive territory. The Dow is up 47.64 points or 0.2 percent at 20,942.47, the Nasdaq is up 9.69 points or 0.2 percent at 6,143.31 and the S&P 500 is up 6.35 points or 0.3 percent at 2,400.37.

The markets continue to benefit from the upward momentum seen in recent days, which has helped lift the major averages well off their lowest levels in nearly a month.

Many traders felt the pullback last Wednesday was overdone amid lingering optimism about President Donald Trump's ability to implement his pro-business policy agenda.

Nonetheless, traders seem somewhat reluctant to make more significant moves ahead of tomorrow's release of the minutes of the latest Federal Reserve meeting.

The minutes of the meeting held earlier this month may shed some additional light on the outlook for interest rates ahead of the next meeting in mid-June.

The Fed is widely expected to raise interest rates next month, with CME Group's FedWatch tool indicating a 78.5 percent chance of a quarter point rate hike.

Meanwhile, traders have largely shrugged off a report from the Commerce Department showing a substantial pullback in new home sales in the month of April.

The Commerce Department said new home sales plunged by 11.4 percent to an annual rate of 569,000 in April from an upwardly revised 642,000 in March.

Economists had expected new home sales to drop to a rate of 602,000 from the 621,000 originally reported for the previous month.

The upwardly revised figure for March reflected the highest rate of new home sales since it reached 727,000 in October of 2007.

Sector News

Many of the major sectors continue to show only modest moves, although considerable strength has emerged among steel stocks. Reflecting the strength in the steel sector, the NYSE Arca Steel Index has surged up by 1.9 percent.

AK Steel (AKS) and Mechel (MTL) are turning in two of the steel sector's best performances, jumping by 6.9 percent and 6.2 percent, respectively.

On the other hand, gold stocks have come under pressure on the day, dragging the NYSE Arca Gold Bugs Index down by 2.2 percent. The weakness in the sector comes as gold for June delivery is sliding $4.70 to $1,256.70 an ounce.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Tuesday. Japan's Nikkei 225 Index fell by 0.3 percent, while China's Shanghai Composite Index dropped by 0.5 percent.

Meanwhile, the major European markets turned in a mixed performance on the day. While the U.K.'s FTSE 100 Index dipped by 0.2 percent, the German DAX Index rose by 0.3 percent and the French CAC 40 Index climbed by 0.5 percent.

In the bond market, treasuries have come under pressure over the course of the trading session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 1.7 basis points at 2.271 percent.