WASHINGTON (dpa-AFX) - After showing a strong move to the upside early in the session, stocks have given back some ground over the course of the trading day on Wednesday. The major averages remain in positive territory but have pulled back well off the record highs set in early trading.
In recent trading, the major averages have moved back to the upside. The Dow is up 87.25 points or 0.3 percent at 26,870.74, the Nasdaq is up 53.16 points or 0.7 percent at 8,194.89 and the S&P 500 is up 13.21 points or 0.4 percent at 2,992.84.
The early rally on Wall Street reflected a positive reaction to Federal Reserve Chairman Jerome Powell's prepared remarks before the House Financial Services Committee.
Powell told lawmakers that crosscurrents, such as trade tensions and concerns about global growth, have continued to weigh on the U.S. economic outlook since the central bank's June meeting.
The Fed chief pointed out that increased uncertainties about the economic outlook and muted inflation pressures led the central bank to pledge after the June meeting to 'act as appropriate to sustain the expansion.'
Powell noted that many meeting participants saw that the case for a somewhat more accommodative monetary policy had already strengthened.
'Since then, based on incoming data and other developments, it appears that uncertainties around trade tensions and concerns about the strength of the global economy continue to weigh on the U.S. economic outlook,' Powell said in his prepared remarks.
The comments from Powell have led to renewed optimism about a potential rate cut by the Fed at its next meeting later this month.
However, traders seem wary of making more substantial bets on stocks, as a rate cut would only be necessary in the face of a slowing economy.
The minutes of the Fed's June meeting, due to be released later in the day, may shed additional light on the outlook for the economy and rates.
Sector News
Tobacco stocks continue to turn in some of the market's best performances in mid-day trading, driving the NYSE Arca Tobacco Index up by 1.8 percent.
Significant strength has also emerged among gold stocks, as reflected by the 1.4 percent gain being posted by the NYSE Arca Gold Bugs Index.
The strength in the gold sector comes amid a notable increase by the price of the precious metal, with gold for August delivery climbing $11.60 to $1,412.10 an ounce.
Computer hardware, natural gas, and oil service stocks have also shown strong moves to the upside, while some weakness is visible among banking stocks.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Wednesday. Japan's Nikkei 225 Index dipped by 0.2 percent, while Hong Kong's Hang Seng Index rose by 0.3 percent.
Meanwhile, the major averages all moved lower over the course of the session. While the German DAX Index fell by 0.5 percent, the U.K.'s FTSE 100 Index and the French CAC 40 Index both edged down by 0.1 percent.
In the bond market, treasuries have climbed back near the unchanged line after an initial move to the downside. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by less than a basis point at 2.049 percent.
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