Tech Stocks Helping Lead Continued Advance On Wall Street

Business

Stocks have moved mostly higher over the course of morning trading on Monday, extending the strong upward move seen in the previous session. Tech stocks have helped the advance, contributing to a particularly strong gain by the tech-heavy Nasdaq.

Currently, the major averages are all in positive territory, although the Dow is up just 38.58 points or 0.1 percent at 34,764.05. The Nasdaq is up 229.21 points or 1.7 percent at 13,999.79 and the S&P 500 is up 27.85 points or 0.6 percent at 4,459.71.

The strength that has emerged on Wall Street comes as traders continue to pick up tech stocks at reduced levels, with the Nasdaq bouncing further off the eight-month closing low set last Thursday.

Positive analyst comments are also contributing to the strength in the tech sector, with Netflix (NFLX), Tesla (TSLA) and Spotify (SPOT) all posting strong gains following upgrades.

Netflix and Spotify were both upgraded to Buy from Neutral by Citi, while Credit Suisse raised its rating on Tesla’s stock to Outperform from Neutral.

Meanwhile, traders are also looking ahead to the Labor Department’s closely watched monthly jobs report on Friday.

Economists currently expect employment to increase by 155,000 jobs in January after rising by 199,000 jobs in December. The unemployment rate is expected to hold at 3.9 percent.

The strength of the monthly jobs data could impact expectations regarding how fast the Federal Reserve will raise rates from near-zero levels in an effort to fight inflation.

Reports on manufacturing and service sector may also attract attention in the coming days along with preliminary data on labor productivity and costs in the fourth quarter.

Semiconductor stocks have helped to lead the rally in the tech sector, with the Philadelphia Semiconductor Index surging up by 2.9 percent.

The index continued to regain ground after hitting its lowest intraday level in over six months before rebounding last Friday.

The strength in the tech sector also reflected significant advances by networking, software and computer hardware stocks.

Considerable strength has also emerged among airline stocks, as reflected by the 2.1 percent jump by the NYSE Arca Airline Index.

Retail, brokerage and housing stocks are also seeing notable strength on the day, while some weakness is visible among oil service stocks.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher on Monday, with the Chinese and South Korean markets closed for the Lunar New Year holiday. Japan’s Nikkei 225 Index and Hong Kong’s Hang Seng Index both jumped by 1.1 percent.

Meanwhile, the major European markets have also moved to the upside on the day. While the German DAX Index has surged up by 1.2 percent, the French CAC 40 Index and the U.K.’s FTSE 100 Index are up by 0.3 percent and 0.2 percent, respectively.

In the bond market, treasuries are seeing modest weakness following the rebound seen over the course of the previous session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 1.3 basis points at 1.795 percent.

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