Stocks Close Mostly Higher On Upbeat Consumer Confidence Data - U.S. Commentary

(RTTNews) - Stocks fluctuated over the course of the trading day on Tuesday but managed to end the session mostly higher. A positive reaction to the latest batch of U.S. economic data helped the markets recover from the pullback seen over the two previous sessions.

The major averages ended the day in positive territory but off their highs for the session. The Dow climbed 91.19 points or 0.6 percent to 16,367.88, the Nasdaq edged up 7.88 points or 0.2 percent to 4,234.27 and the S&P 500 rose 8.18 points or 0.4 percent to 1,865.62.

The strength on Wall Street was largely attributed to the release of a report from the Conference Board showing a significant improvement in consumer confidence in the month of March.

The Conference Board said its consumer confidence index jumped to 82.3 in March from a revised 78.3 in February. Economists had been expecting the index to edge up to 78.4.

With the much bigger than expected increase, the consumer confidence index reached its highest level since January of 2008.

"Consumer confidence improved in March, as expectations for the short-term outlook bounced back from February's decline," said Lynn Franco, Director of Economic Indicators at the Conference Board.

While a separate report from the Commerce Department showed a drop in new home sales in February, the data was largely shrugged off due to the influence of the weather.

Buying interest was somewhat subdued, however, as traders continue to express uncertainty about whether the current state of the economy supports further upside for the markets.

Some recent data points to the economy breaking out of the winter doldrums, but traders seem to be waiting for more concrete evidence of a recovery.

Among individual stocks, shares of Sonic (SONC) moved sharply higher after the restaurant operator reported better than expected second quarter earnings growth and provided upbeat full-year guidance.

Italian eyewear maker Luxottica (LUX) also posted a strong gain on news that the company has reached an agreement to design, develop and distribute a new breed of eyewear for Google Glass.

On the other hand, shares of Carnival (CCL) came under pressure after the cruise operator warned that it might post a loss for the current quarter due to higher costs.

Sector News

Airline stocks showed a strong move to the upside on the day, driving the NYSE Arca Airline Index up by 1.6 percent. With the gain, the index ended the day just shy of the nearly twelve-year closing high set a week ago.

Delta (DAL) and American (AAL) turned in two of the airline sector's best performances, advancing by 3.3 percent and 3 percent, respectively.

Considerable strength was also visible among computer hardware stocks, which rebounded after ending the previous session notably lower. Reflecting the strength in the sector, the NYSE Arca Computer Hardware Index rose by 1.6 percent.

Steel, oil service, telecom, and pharmaceutical stocks also saw significant strength on the day, moving higher along with most of the other major sectors.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Tuesday. Japan's Nikkei 225 Index dropped by 0.4 percent, while Hong Kong's Hang Seng Index ended the day down by 0.5 percent.

Meanwhile, the major European markets showed strong moves to the upside on the day. While the U.K.'s FTSE 100 Index jumped by 1.3 percent, the French CAC 40 Index and the German DAX Index both surged up by 1.6 percent.

In the bond market, treasuries spent much of the session lingering near the unchanged after recovering from an early drop. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, inched up by less than a basis point to 2.735 percent.

Looking Ahead

Trading on Wednesday could be impacted by the Commerce Department's report on durable good orders in the month of February. Economists expect orders to rebound by 1 percent after falling by 1 percent in the previous month.