Stocks Holding On To Strong Gains Following Early Rally - U.S. Commentary

(RTTNews) - After moving sharply higher earlier in the session, stocks have continued to turn in a strong performance over the course of the trading day on Monday. The major averages are adding to the gains posted in the two previous sessions, climbing further off last Wednesday's multi-month lows.

Currently, the major averages are hovering near their best levels of the day. The Dow is up 191.91 points or 1.1 percent at 17,952.32, the Nasdaq is up 65.08 points or 1.3 percent at 5,062.78 and the S&P 500 is up 18.97 points or 0.9 percent at 2,095.59.

The early rally on Wall Street came amid news Greece and its international creditors have finally reached an agreement on a new bailout for the debt-laden country.

After hours of negotiations, Greece and its creditors reached a conditional agreement that consists of several tough austerity measures.

European Council President Donald Tusk said the agreement comes with strict conditions but places Greece on a path of growth and helps regain trust.

"We had only one objective: to reach an agreement." Tusk said in a press conference. "After 17 hours of negotiations, we have finally reached it. One can say that we have 'agreekment.'"

He added, "Leaders have agreed in principle that they are ready to start negotiations on an [European Stability Mechanism] program, which in other words means continued support for Greece."

The news has generated considerable positive sentiment, although the intricacies and complexities involved have led to continued skepticism among some analysts.

Jonathan Loynes, Chief European Economist at Capital Economics, said the tentative deal clearly reduces the risk of Greece exiting the eurozone but noted significant hurdles must still be overcome.

"And the negotiations over debt restructuring, which have been put off again, may yet prompt a Grexit," Loynes said.

Nonetheless, the news may allow traders to take a break from scrutinizing the constantly shifting situation in Greece and focus on upcoming U.S. economic reports on retail sales, inflation, and housing.

Federal Reserve Chair Janet Yellen's semi-annual congressional testimony is also likely to attract attention this week along with the release of earnings news from a slew of big-name companies.

Sector News

Steel stocks have shown a substantial move to the upside in recent trading, driving the NYSE Arca Steel Index up by 3.1 percent. The index is climbing further off the six-year closing low it set last Wednesday.

AK Steel (AKS), Cliffs Natural Resources (CLF), and U.S. Steel (X) are turning in some of the sector's best performances on the day.

Considerable strength also remains visible among airline stocks, as reflected by the 2.4 percent gain being posted by the NYSE Arca Airline Index. Brazilian airline GOL (GOL) is posting a standout gain, jumping by 14.1 percent.

Internet, trucking, biotechnology, and retail stocks are also seeing notable strength in mid-day trading, moving higher along with most of the other major sectors.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Monday. Japan's Nikkei 225 Index surged up by 1.6 percent, while Hong Kong's Hang Seng Index jumped by 1.3 percent.

The major European markets also moved to the upside on the day. While the U.K.'s FTSE 100 Index advanced by 1 percent, the German DAX Index and the French CAC 40 Index shot up by 1.5 percent and 1.9 percent, respectively.

In the bond market, treasuries have regained ground after moving moderately lower earlier in the session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by less than a basis point at 2.423 percent.