Stocks Move The Upside, Nasdaq And S&P 500 Set Record Highs - U.S. Commentary

(RTTNews) - Stocks have moved mostly higher in early trading on Tuesday, offsetting the modest pullback that was seen in the previous session. With the upward move on the day, the Nasdaq and the S&P 500 have reached new record intraday highs.

Currently, the major averages are just off their highs for the young session. The Dow is up 41.98 points or 0.2 percent at 18,571.27, the Nasdaq is up 21.53 points or 0.4 percent at 5,234.67 and the S&P 500 is up 5.22 points or 0.2 percent at 2,186.11.

Semiconductor stocks have shown a strong move to the upside, driving the Philadelphia Semiconductor Index up by 1 percent. The index is on pace to end the session at its best closing level in over fifteen years.

Microchip Technology (MCHP) is leading the semiconductor sector higher after reporting better than expected first quarter results and providing upbeat guidance.

Gold and pharmaceutical stocks are also seeing some early strength, while oil service stocks have come under pressure on the day.

The early strength on Wall Street comes despite the release of a report from the Labor Department showing an unexpected drop in labor productivity in the second quarter.

The report showed that productivity fell by 0.5 percent in the second quarter after sliding by 0.6 percent in the first quarter. The decrease came as a surprise to economists, who had expected productivity to climb by 0.5 percent.

Meanwhile, the Labor Department said unit labor costs surged up by 2.0 percent in the second quarter after edging down by a revised 0.2 percent in the first quarter.

Economists had expected labor costs to climb by 1.8 percent compared to the 4.5 percent jump that had been reported for the previous quarter.

A separate report from the Commerce Department showed an unexpected increase in wholesale inventories in the month of June.

The report said wholesale inventories rose by 0.3 percent in June following an upwardly revised 0.2 percent increase in May.

Economists had expected inventories to come in unchanged compared to the 0.1 percent uptick that had been reported for the previous month.

Meanwhile, the Commerce Department said wholesale sales shot up by 1.9 percent in June following a 0.7 percent increase in May.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Tuesday. Japan's Nikkei 225 Index advanced by 0.7 percent, while Hong Kong's Hang Seng Index edged down by 0.1 percent.

Meanwhile, the major European markets have all moved to the upside on the day. While the German DAX Index has shot up by 1.4 percent, the French CAC 40 Index and the U.K.'s FTSE 100 Index are up by 0.8 percent and 0.7 percent, respectively.

In the bond market, treasuries have moved modestly higher after ending the previous session nearly flat. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 1.5 basis points at 1.568 percent.