WASHINGTON (dpa-AFX) - Stocks showed a lack of direction early in the session on Friday but have moved mostly higher over the course of the trading day. The major averages have climbed more firmly into positive territory after bouncing back and forth across the unchanged line in early trading.
Currently, the major averages are just off their highs of the session. The Dow is up 112.51 points or 0.3 percent at 40,675.57, the Nasdaq is up 65.38 points or 0.4 percent at 17,659.88 and the S&P 500 is up 14.40 points or 0.3 percent at 5,557.62.
The strength that has emerged on Wall Street may partly reflect recent upward momentum, with the major averages extending the upward trend seen over the past several sessions.
The Nasdaq and the S&P 500 are moving higher for the seventh consecutive session and have moved than offset the steep drop seen early this week.
The buying interest also comes as recent data has eased concerns about the economic outlook while also increasing confidence the Federal Reserve will cut interest rates next month.
While yesterday's upbeat retail sales data has reduced the likelihood of a 50 basis point rate cut, the Fed is still widely expected to cut rates by at least 25 basis points.
In U.S. economic news, preliminary data released by the University of Michigan showed consumer sentiment in the U.S. has improved by more than expected in the month of August.
The University of Michigan said its consumer sentiment index rose to 67.8 in August after falling to 66.4 in July. Economists had expected the index to inch up to 66.9.
The consumer sentiment index regained ground after hitting its lowest level since November 2023 in the previous month.
On the inflation front, the report said year-ahead and long-term inflation expectations were both unchanged from the previous month at 2.9 percent and 3.0 percent, respectively.
Meanwhile, the Commerce Department released a report showing a sharp pullback by new residential construction in the month of July.
The report said housing starts plunged by 6.8 percent to an annual rate of 1.238 million in July after jumping by 1.1 percent to a revised rate of 1.329 million in June.
Economists had expected housing starts to slump by 1.7 percent to an annual rate of 1.330 million from the 1.353 million originally reported for the previous month.
With the sharp pullback, housing starts tumbled to their lowest level since hitting an annual rate of 1.053 million in May 2020.
The Commerce Department said building permits also plummeted by 7.0 percent to an annual rate of 1.396 million in July after surging by 3.9 percent to a revised rate of 1.454 million in June.
Building permits, an indicator of future housing demand, were expected to decrease by 1.1 percent to an annual rate of 1.430 million from the 1.446 million originally reported for the previous month.
Sector News
Despite the advance by the broader markets, most of the major sectors continue to show only modest moves on the day.
Gold stocks continue to see significant strength, however, resulting in a 2.2 percent jump by the NYSE Arca Gold Bugs Index
The strength among gold stocks comes amid a sharp increase by the price of the precious metal, with gold for December delivery surging $39.90 to $2,532.30 an ounce.
Financial and computer hardware stocks have also moved to the upside over the course of the session, while weakness remains visible among airline stocks.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved sharply higher during trading on Friday. Japan's Nikkei 225 Index spiked by 3.6 percent, while Hong Kong's Hang Seng Index shot up by 1.9 percent.
Meanwhile, the major European markets turned in a mixed performance on the day. While the U.K.'s FTSE 100 Index fell by 0.4 percent, the French CAC 40 Index climbed by 0.4 percent and the German DAX Index advanced by 0.8 percent.
In the bond market, treasuries are regaining ground following the sharp pullback seen in the previous session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 3.6 basis points at 3.890 percent.
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