WASHINGTON (dpa-AFX) - Stocks continue to turn in a strong performance in mid-day trading on Wednesday after moving to the upside early in the session. With the upward move, the major averages have offset the sharp pullback seen late in the previous session.
Currently, the major averages are all firmly in positive territory, although the Nasdaq is outperforming its counterparts. While the Nasdaq is up 229.16 points or 2.1 percent at 11,011.98, the Dow is up 242.46 points or 0.9 percent at 27,929.37 and the S&P 500 is up 46.29 points or 1.4 percent at 3,379.98.
The strength on Wall Street partly reflects a rebound by tech stocks, which pulled back sharply after the tech-heavy Nasdaq reached another new record closing high last Thursday.
Big-name tech companies like Microsoft (MSFT), Apple (AAPL) and Netflix (NFLX) are posting notable gains, partly offsetting the recent weakness.
Shares of Tesla (TSLA) have also moved sharply higher after the electric car maker said its board has approved and declared a five-for-one split of the company's common stock in the form of a stock dividend.
Positive sentiment may also have been generated by news that the U.S. government has secured 100 million doses of Moderna's (MRNA) experimental COVID-19 vaccine in a deal valued at up to $1.525 billion.
Meanwhile, traders have largely shrugged off a report from the Labor Department showing the biggest increase in core consumer prices in nearly thirty years.
The Labor Department said its consumer price index climbed by 0.6 percent in July, matching the increase seen in June. Economist had expected consumer prices to rise by 0.3 percent.
Excluding food and energy prices, core consumer prices still advanced by 0.6 percent in July after inching up by 0.2 percent in the previous month. Core prices were expected to edge up by another 0.2 percent.
Core consumer prices showed their biggest increase since January of 1991, partly reflecting another jump in prices for motor vehicle insurance.
Paul Ashworth, Chief U.S. Economist at Capital Economics, said the increase in consumer prices 'should end any speculation that the pandemic-related slump in demand will quickly push the economy into a deflationary spiral.'
'But this is not a sign that the U.S. is instead about to experience a bout of much high inflation because of supply restrictions,' Ashworth said. 'It mainly reflects a recovery in the prices of goods and services that were most affected during the early stages of the pandemic.'
Sector News
Semiconductor stocks have moved sharply higher over the course of the session, resulting in a 2.4 percent spike by the Philadelphia Semiconductor Index.
Substantial strength also remains visible among software stocks, as reflected by the 2.4 percent jump by the Dow Jones U.S. Software Index.
Pharmaceutical stocks also continue to turn in a strong performance in mid-day trading, with the NYSE Arca Pharmaceutical Index advancing by 2 percent.
Utilities, retail and gold stocks are also seeing notable strength, while considerable weakness has emerged among airline 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 rose by 0.4 percent, while China's Shanghai Composite Index fell by 0.6 percent.
Meanwhile, the major European markets all moved to the upside on the day. While the U.K.'s FTSE 100 Index spiked by 2.2 percent, the French CAC 40 Index and the German DAX Index both advanced by 0.9 percent.
In the bond market, treasuries are extending the notable pullback seen over the past few sessions. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 2.2 basis points at 0.680 percent.
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