WASHINGTON (dpa-AFX) - Stocks showed a lack of direction over the course of Monday's session before closing moderately lower but showed a strong move back to the upside during trading on Tuesday. The tech-heavy Nasdaq helped lead the way higher.
The major averages ended the day off their highs of the session but still firmly positive. The Nasdaq surged 259.19 points or 1.4 percent to 18,439.17, the S&P 500 shot up 70.07 points or 1.2 percent to 5,782.76 and the Dow jumped 427.28 points or 1.0 percent to 42,221.88.
The rally on Wall Street may partly have reflected optimism the stock market and the U.S. economy in general will continue to perform well regardless of the results of today's elections.
Polls show an extremely tight race between Vice President Kamala Harris and former President Donald Trump, suggesting the outcome of the presidential election may not be known by the end of the night.
The results of House and Senate races are also likely to be in focus, as the makeup of Congress could affect how much the next president can accomplish.
Adding to the positive sentiment about the economy, a report from the Institute for Supply Management showed service sector activity unexpectedly grew at an accelerated rate in the month of October.
The ISM said its services PMI rose to 56.0 in October from 54.9 in September, with a reading above 50 indicating growth. The uptick surprised economists, who had expected the index to dip to 53.8.
With the unexpected increase, the ISM's services PMI reached its highest level since hitting 56.4 in July 2022.
A separate report released by the Commerce Department showed a significant increase in the size of the U.S. trade deficit in the month of September, as imports surged and exports slumped.
Sector News
Airline stocks showed a substantial move to the upside on the day, with the NYSE Arca Airline Index soaring by 2.8 percent.
Considerable strength was also visible among housing stocks, as reflected by the 2.3 percent surge by the Philadelphia Housing Sector Index.
Biotechnology stocks also saw considerable strength, driving the NYSE Arca Biotechnology Index up by 1.6 percent to its best closing level in well over three years.
Brokerage, computer hardware and semiconductor stocks also showed significant 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 Tuesday. Japan's Nikkei 225 Index advanced by 0.9 percent, while China's Shanghai Composite Index surged by 2.3 percent.
Most European stocks also moved to the upside on the day. The German DAX Index climbed by 0.6 percent and the French CAC 40 Index rose by 0.5 percent, although the U.K.'s FTSE 100 Index bucked the uptrend and edged down by 0.1 percent.
In the bond market, treasuries recovered from early weakness to close modestly higher. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, dipped 2.0 basis points to 4.289 percent after reaching a high of 4.366 percent.
Looking Ahead
Amid a quiet day on the U.S. economic front, trading on Wednesday is likely to driven by whether or not a winner is officially called in the presidential election.
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