Following the strong upward move seen last week, stocks turned in a relatively lackluster performance during trading on Monday. The major averages spent the day bouncing back and forth across the unchanged line before closing modestly higher.
The Nasdaq rose 28.85 points or 0.2 percent to 13,816.77, the S&P 500 (SPI:SP500) inched up 5.21 points or 0.1 percent to 4,455.59 and the Dow crept up 10.87 points or less than a tenth of a percent to 34,418.47. With the uptick, the Nasdaq and the S&P 500 reached their best closing levels in over a year.
The choppy trading on Wall Street came as traders seemed reluctant to make significant moves amid uncertainty about the near-term outlook for the markets.
A number of traders also remained away from their desks amid an abbreviated trading session and the 4th of July holiday on Tuesday.
When trading resumes, the focus will shift to the minutes of the latest Federal Reserve meeting along with the Labor Department’s closely watched monthly jobs report.
Recent data has pointed to a resilient U.S. economy, while slowing inflation has added to optimism about the outlook for interest rates.
While the Fed is still widely expected to raise interest rates by a quarter point later this month, traders are hopeful that will be end of the rate-hiking cycle.
On the U.S. economic front, the Institute for Supply Management released a report showing manufacturing activity unexpectedly contracted at a slightly faster rate in the month of June.
The ISM said its manufacturing PMI edged down to 46.0 in June from 46.9 in May, with a reading below 50 indicating contraction. The dip surprised economists, who had expected the index to inch up to 47.2.
A separate report released by the Commerce Department showed U.S. construction spending climbed by more than expected in the month of May, although the advance came following a notably downwardly revised increase in April.
Sector News
Most of the major sectors showed only modest moves on the day, contributing to the lackluster performance by the broader markets.
Banking stocks showed a strong move to the upside, however, with the KBW Bank Index jumping by 1.8 percent.
Considerable strength was also visible among brokerage stocks, as reflected by the 1.7 percent gain posted by the NYSE Arca Broker/Dealer Index.
Gold, tobacco and steel stocks also saw strength on the day, while pharmaceutical stocks showed a significant move to the downside.
Within the pharmaceutical sector, AstraZeneca (NASDAQ:AZN) moved sharply lower after results from a high-level study of a new lung cancer treatment lagged expectations.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved sharply higher during trading on Monday. Japan’s Nikkei 225 Index surged by 1.7 percent, while China’s Shanghai Composite Index jumped by 1.3 percent.
Meanwhile, the major European markets moved to the downside on the day. While the German DAX Index fell by 0.4 percent, the French CAC 40 Index dipped by 0.2 percent and the U.K.’s FTSE 100 Index edged down by 0.1 percent.
In the bond market, treasuries have moved lower over the course of the session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 4.3 basis points at 3.862 percent.
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