U.S. Stocks Remain Mostly Positive After Reaching Record Highs

After moving to the upside early in the session, stocks remain mostly positive in afternoon trading on Tuesday. The major averages are adding to gains posted in the previous session and reached new record intraday highs.

Currently, the major averages are all in positive territory, although the Dow is posting a relatively modest gain. While the Dow is up 30.29 points or 0.1 percent at 29,307.11, the Nasdaq is up 50.54 points or 0.5 percent at 9,678.93 and the S&P 500 is up 14.23 points or 0.4 percent at 3,366.32.

The climb to new record highs comes as traders continue to shrug off concerns about the economic impact of the deadly coronavirus outbreak.

Several companies have already warned about the impact of the virus, but traders seem confident the U.S. economy is strong enough to withstand the negative effects.

Federal Reserve Chairman Jerome Powell said during testimony before the House Financial Services Committee that the central bank is closely monitoring the coronavirus outbreak but also highly the resilience of the U.S. economy.

In prepared remarks, Powell noted some of the uncertainties around trade have diminished following the signing of the phase one U.S.-China trade deal but cautioned risks to the outlook remain.

“In particular, we are closely monitoring the emergence of the coronavirus, which could lead to disruptions in China that spill over to the rest of the global economy,” Powell said.

However, Powell pointed out that the U.S. economy has recently appeared resilient to global headwinds, with economic activity increasing at a moderate pace over the second half of last year.

Sector News

Telecom stocks continue to see substantial strength on the day, with the NYSE Arca North American Telecom Index spiking by 6 percent to its best intraday level in well over a year.

Sprint (S) is leading the way higher, soaring by 73.5 percent following news T-Mobile (TMUS) has won court approval for its $26.5 billion takeover of the telecom company.

Significant strength also remains visible among semiconductor stocks, as reflected by the 2.2 percent jump by the Philadelphia Semiconductor Index.

Steel, brokerage, and networking stocks are also seeing considerable strength, moving higher along with most of the other major sectors.

Meanwhile, tobacco stocks are bucking the uptrend, giving back ground after moving sharply higher in the previous session.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Tuesday. China’s Shanghai Composite Index rose by 0.4 percent, while Hong Kong’s Hang Seng Index jumped by 1.3 percent. The Japanese markets were closed for a holiday.

The major European markets also moved to the upside on the day. While the German DAX Index surged up by 1 percent, the U.K.’s FTSE 100 Index and the French CAC 40 Index both climbed 7 percent.

In the bond market, treasuries are giving back ground after moving notably higher over the two previous sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 4.3 basis points at 1.590 percent.

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