WASHINGTON (dpa-AFX) - Stocks showed a strong move to the upside during trading on Monday, extending the rally seen to close out the previous week. With the continued advance, the major averages reached their best closing levels in almost a month.
The Nasdaq and the S&P 500 reached new highs for the session going into the close of trading, The Nasdaq surged 192.92 points or 1.2 percent to 16,349.25, the S&P 500 jumped 52.95 points or 1.0 percent to 5,180.74 and the Dow climbed 176.59 points or 0.5 percent to 38,862.27.
Stocks continued to benefit from the upward momentum seen over the two previous sessions, which partly reflected renewed optimism about the outlook for interest rates.
Relatively dovish comments from Federal Reserve Chair Jerome Powell combined with weaker-than-expected job growth in April have largely eliminated short-lived concerns the Fed might actually consider raising rates.
Investors have instead grown increasingly confident about a rate cut in the coming months, with the chances rates will be lower by September now at 83.5 percent, according to CME Group's FedWatch Tool.
However, the upward move may have been exaggerated by light volume, as a lack of major U.S. economic data kepts some traders on the sidelines.
The economic calendar remains relatively quiet throughout the week, although a preliminary reading on consumer sentiment in May might attract some attention along with remarks by several Fed officials.
Among individual stocks, shares of Bausch + Lomb (BLCO) moved sharply higher on the day after Morgan Stanley upgraded its rating on the eye care company's stock to Overweight from Equal Weight.
Media and entertainment giant Paramount Global (PARA) also surged after a report from the New York Times said the company decided to formally open negotiations with a bidding group led by Sony Pictures Entertainment and the private equity giant Apollo.
Meanwhile, shares of Spirit Airlines (SAVE) plummeted after the discount carrier reported a slightly wider than expected first quarter loss and provided disappointing second quarter revenue guidance.
Sector News
Semiconductor stocks showed a substantial move to the upside over the course of the session, driving the Philadelphia Semiconductor Index up by 2.2 percent to its best closing level in almost a month.
Considerable strength was also visible among gold stocks, as reflected by the 2.2 percent surge by the NYSE Arca Gold Bugs Index.
The rally by gold stocks came amid an increase by the price of the precious metal, with gold for June delivery climbing $24.20 to $2,332.80 an ounce.
Computer hardware stocks also saw significant strength on the day, resulting in a 2.2 percent jump by the NYSE Arca Computer Hardware Index.
Software, brokerage and housing stocks also showed notable moves to the upside, moving higher along with most of the other major sectors.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Monday, with markets in Japan and South Korea closed for holidays. China's Shanghai Composite Index rallied by 1.2 percent, while Hong Kong's Hang Seng Index climbed by 0.6 percent.
The major European markets also moved to the upside on the day. While the German DAX Index jumped by 1.0 percent, the French CAC 40 Index and the U.K.'s FTSE 100 Index both rose by 0.5 percent.
In the bond market, treasuries showed a lack of direction over the course of the session before closing roughly flat. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, edged down 1.1 basis points to 4.489 percent.
Looking Ahead
Earnings news may drive trading on Tuesday amid another quiet day on the U.S. economic front, with Disney (DIS) among the companies due to report their quarterly results before the start of trading.
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