Positive Reaction To Data Pushing Stocks Higher - U.S. Commentary

(RTTNews) - With traders reacting positively to a batch of U.S. economic data, stocks have moved mostly higher during trading on Friday. The gains on the day are extending yesterday's upward move, with the S&P 500 setting a new record high.

The major averages have moved to the upside in recent trading, with the Dow and the S&P 500 reaching new highs. The Dow is up 114.69 points or 0.7 percent at 16,387.34, the Nasdaq is up 21.12 points or 0.5 percent at 4,340.05 and the S&P 500 is up 13.24 points or 0.7 percent at 1,867.53.

The strength on Wall Street comes following the release of a slew of economic data, including a report showing an unexpected acceleration in the pace of Chicago-area business activity.

The report from MNI Indicators said the Chicago Business Barometer ticked up to 59.8 in February from 59.6 in January, with a reading above 50 indicating growth in Chicago-area business activity. Economists had expected the barometer to drop to 56.4.

Thomson Reuters and the University of Michigan also released a report showing a modest upward revision to their reading on consumer sentiment in February, while the National Association of Realtors reported a slight uptick in pending home sales in January.

Meanwhile, traders have largely shrugged off a report from the Commerce Department showing a notable downward revision to pace of fourth quarter GDP growth.

The report said GDP rose by 2.4 percent in the fourth quarter compared to the previously reported 3.2 percent growth, but the data has been viewed as old news.

Peter Boockvar, managing director at the Lindsey Group, said, "We're already 2/3 of the way thru Q1, which we know was influenced by the weather and is expected to slow to about 2% growth but to be followed by expected growth of around 3% in the 3 quarters thereafter in 2014."

Among individual stocks, Monster Beverage (MNST) has moved notably higher after reporting a jump in fourth quarter sales despite facing legal threats against its caffeinated energy drinks.

Shares of Jos. A. Bank (JOSB) are also seeing significant strength after the apparel retailer rejected Men's Wearhouse's (MW) $63.50 per share takeover offer as inadequate. The company indicated that it is willing to consider a higher price.

Meanwhile, shares of Pier 1 Imports (PIR) have come under pressure after the home furnishings retailer cut is fourth quarter guidance due to significant disruptions from adverse weather in many major markets.

Sector News

Railroad stocks are seeing significant strength in mid-day trading, with the Dow Jones Railroads Index advancing by 1.2 percent. The index has moved toward the high end of a recent range and is currently poised to set a new record closing high.

American Railcar (ARII), Norfolk Southern (NSC), and FreightCar America (RAIL) are turning in some of the railroad sector's best performances.

Oil service, chemical, and utilities stocks have also moved to the upside on the day, moving higher along with most of the other major sectors.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in yet another mixed performance during trading on Friday. Japan's Nikkei 225 Index dropped by 0.6 percent, while China's Shanghai Composite Index rose by 0.4 percent.

The major European markets also ended the day mixed. While the U.K.'s FTSE 100 Index closed just below the unchanged line, the German DAX Index jumped 1.1 percent and the French CAC 40 Index ended the day up by 0.3 percent.

In the bond market, treasuries have come under pressure after trending higher over the past few sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 4.3 basis points at 2.685 percent.