WASHINGTON (dpa-AFX) - Stocks have moved modestly higher in morning trading on Monday, adding to the strong gains posted last week. The major averages have all climbed into positive territory, although buying interest has remained somewhat subdued.
The major averages have pulled back off their highs in recent trading but are currently holding on to slim gains. The Dow is up 62.87 points or 0.3 percent at 25,445.98, the Nasdaq is up 30.99 points or 0.3 percent at 9,520.86 and the S&P 500 is up 4.65 points or 0.2 percent at 3,048.96.
The modest strength on Wall Street comes following the release of a report from the Institute for Supply Management showing U.S. manufacturing activity contracted at a slower rate in the month of May.
The ISM said its purchasing managers index rose to 43.1 in May from 41.5 in April, coming in just below economist estimates for a reading of 43.6.
While the index rebounded from its lowest level since April of 2009, a reading below 50 still indicates a contraction in manufacturing activity.
Nonetheless, Timothy R. Fiore, Chair of the ISM Manufacturing Business Survey Committee, said the latest figure indicates expansion in the overall economy after April's contraction.
The report from the ISM comes on the heels of a private survey showing the Chinese manufacturing sector expanded in May.
The Caixin manufacturing PMI score came in at 50.7 in May, beating expectations for a score of 49.6 and up from 49.4 in April. A reading above 50 indicates an expansion in manufacturing activity.
A separate report from the Commerce Department showed a sharp pullback in U.S. construction spending in the month of April, although the decrease was much smaller than economists had expected.
Traders remain generally optimistic about economies reopening despite political unrest across the country following the death of George Floyd, which has forced a number of major retailers to temporarily close their stores in areas hit hard by protests.
Banking stocks have shown a strong move back to the upside following the sharp pullback seen over the two previous sessions, with the KBW Bank Index surging up by 2.3 percent.
Significant strength has also emerged among oil service stocks, as reflected by the 2.3 percent jump by the Philadelphia Oil Service Index.
The strength in the oil service sector comes despite a decrease by the price of crude oil, with crude for July delivery sliding $0.47 to $35.02 a barrel.
Steel, brokerage and housing stocks are also seeing notable strength, while some weakness is visible among pharmaceutical stocks.
Pfizer (PFE) is leading the pharmaceutical sector lower after the drug giant reported disappointing results from a phase 3 trial of its new breast cancer therapy.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Monday. Japan's Nikkei 225 Index climbed by 0.8 percent, while Hong Kong's Hang Seng Index jumped by 3.4 percent.
European stocks have also moved to the upside on the day, although several major markets are closed for public holidays. While the U.K.'s FTSE 100 Index has surged up by 1.2 percent, the French CAC 40 Index has spiked by 1.5 percent.
In the bond market, treasuries are giving back ground after moving notably higher last Friday. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 3.4 basis points at 0.682 percent.
Copyright RTT News/dpa-AFX