Stocks Fluctuate But Manage To Close Mostly Higher - U.S. Commentary

(RTTNews) - Stocks fluctuated over the course of the trading day on Monday but maintained a positive bias throughout much of the session. The Nasdaq and the S&P 500 eventually ended the session at their best closing levels in over five months.

The major averages all closed in positive territory, adding to last week's gains. The Dow rose 65.23 points or 0.3 percent to 25,914.10, the Nasdaq climbed 25.95 points or 0.3 percent to 7,714.48 and the S&P 500 advanced 10.46 points or 0.4 percent to 2,832.94.

The strength on Wall Street reflected continued optimism about a U.S.-China trade deal after China's state-owned Xinhua news agency reporting the U.S. and China have made further "concrete progress" on the text of a final agreement.

News on the merger-and-acquisition front added to the positive sentiment, as Deutsche Bank (DB) and rival German bank Commerzbank confirmed they are in merger talks.

Buying interest was somewhat subdued, however, as traders seemed reluctant to make significant moves ahead of the Federal Reserve's monetary policy announcement later this week.

The Fed is widely expected to leave interest rates unchanged, although traders are likely to keep a close eye on the accompanying statement for clues about the outlook for rates.

The central bank's economic projections and Fed Chairman Jerome Powell's subsequent press conference are also likely to be in focus.

On the U.S. economic front, a report from the National Association of Home Builders showed homebuilder confidence has held steady in the month of March.

The report said the NAHB/Wells Fargo Housing Market Index came in at 62 in March, unchanged from February. Economists had expected the index to inch up to 63.

"Builders report the market is stabilizing following the slowdown at the end of 2018 and they anticipate a solid spring home buying season," said NAHB Chairman Greg Ugalde.

Sector News

Despite the fluctuations by the broader markets, oil service stocks saw substantial strength throughout the trading session. Reflecting the strength in the sector, the Philadelphia Oil Service Index spiked by 3.9 percent.

The rally by oil service stocks came amid an increase by the price of crude oil, with crude for April delivery climbing $0.49 to $59.01 a barrel.

Considerable strength also emerged among natural gas stocks, as reflected by the 2.2 percent jump by the NYSE Arca Natural Gas Index.

Steel, financial, and retail stocks also moved notably higher over the course of the session, while significant weakness was visible among gold stocks.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Monday. Japan's Nikkei 225 Index advanced by 0.6 percent, while China's Shanghai Composite Index spiked by 2.5 percent.

Meanwhile, the major European markets turned in a mixed performance on the day. While the German DAX Index fell by 0.3 percent, the French CAC 40 Index inched up by 0.1 and the U.K.'s FTSE 100 Index jumped by 1 percent.

In the bond market, treasuries showed a lack of direction throughout much of the session before closing slightly lower. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, crept up by less than a basis point to 2.602 percent.

Looking Ahead

A report on factory orders may attract some attention on Tuesday, although trading activity is likely to remain subdued ahead of the Fed announcement on Wednesday.