WASHINGTON (dpa-AFX) - Stocks initially extended yesterday's rally in early trading on Wednesday but have given back ground over the course of the session. The major averages have pulled back well off their highs of the session but currently remain in positive territory.
After reaching new record intraday highs, the Nasdaq is up 39.76 points or 0.2 percent at 21,721.67 and the S&P 500 is up 9.81 points or 0.2 percent at 6,455.57. The narrower Dow is more firmly positive, up 244.81 points or 0.6 percent at 44,703.42.
The early strength on Wall Street came as stocks continued to benefit from optimism about an interest rate cut by the Federal Reserve following yesterday's consumer price inflation data.
With the consumer price inflation data largely coming in line with economist estimates, the Fed is widely expected to lower rates by a least a quarter point next month.
U.S. Treasury Secretary Scott Bessent wants the Fed to keep the door open to a larger, 50 basis point rate cut next month following recent weak jobs data.
CME Group's FedWatch Tool is currently indicating a 97.9 percent chance the Fed will cut rates by 25 basis points in September.
President Donald Trump also continues to pressure Fed Chair Jerome Powell to lower rates and recently threatened to allow a 'major lawsuit' against him over renovations at the Fed's headquarters to proceed.
Buying interest has waned over the course of the session, however, with a lack of major U.S. economic data keeping some traders on the sidelines.
Reports on producer price inflation, retail sales, industrial production and consumer sentiment are likely to attract attention in the coming days.
Sector News
Computer hardware stocks are seeing substantial strength on the day, with the NYSE Arca Computer Hardware Index surging by 2.1 percent.
Considerable strength is also visible among housing stocks, as reflected by the 1.8 percent jump by the Philadelphia Housing Sector Index. With the gain, the index has reached its best intraday level in over seven months.
Pharmaceutical and biotechnology stocks are also seeing significant strength on the day, while brokerage stocks have shown a notable move to the downside.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Wednesday. Japan's Nikkei 225 Index jumped by 1.3 percent, while Hong Kong's Hang Seng Index surged by 2.6 percent.
The major European markets have also moved to the upside on the day. While the U.K.'s FTSE 100 Index is up by 0.2 percent, the German DAX Index and the French CAC 40 Index are both up by 0.8 percent.
In the bond market, treasuries are seeing notable strength following the modest pullback seen in the previous session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 6.2 basis points at 4.231 percent.
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