Stocks Move Sharply Higher Amid Rally In Europe - U.S. Commentary

(RTTNews) - Stocks have moved sharply higher in early trading on Friday after ending the previous session roughly flat. The major averages have climbed firmly into positive territory, with the Dow and the S&P 500 reaching their best intraday levels in over two months.

Currently, the major averages are just off their highs for the young session. The Dow is up 195.32 points or 1.2 percent at 17,190.45, the Nasdaq is up 62.58 points or 1.3 percent at 4,724.73 and the S&P 500 is up 24.22 points or 1.2 percent at 2,013.79.

A rally by European stocks has contributed to the early strength on Wall Street, as the European STOXX 600 Index is surging up by 2.3 percent.

The strength in the European markets reflects a rebound after stocks pulled back sharply over the course of the previous session.

Analysts have attributed the rebound by European stocks to renewed optimism about the European Central Bank's new stimulus measures announced on Thursday.

While traders soured on the stimulus as the previous session progressed, they appear to have once again rethought their stance on the issue.

A notable increase by the price of crude oil has also generated some buying interest, with crude for April delivery climbing $0.81 to $38.65 a barrel.

Earlier in the session, the price of crude oil reached its highest level of 2016, benefiting from an optimistic report from the International Energy Agency.

In its monthly report, the IEA said the price of oil may have bottomed due to lower output from the U.S. and other non-OPEC producers.

Energy stocks are seeing substantial strength on the day amid the increase by the price of crude oil, further offsetting the steep drop seen on Tuesday.

While the NYSE Arca Oil & Gas Index has jumped by 2.4 percent, the Philadelphia Oil Service Index and the NYSE Arca Natural Gas Index are surging up by 4 percent and 4.3 percent, respectively.

Significant strength has also emerged among brokerage stocks, as reflected by the 2.5 percent gain being posted by the NYSE Arca Broker/Dealer Index. The index has risen to its best intraday level in almost two months.

Chemical, transportation, housing, and computer hardware stocks are also seeing considerable strength amid broad based buying interest on Wall Street.

In overseas trading, stock markets across the Asia-Pacific region moved to the upside during trading on Friday. Japan's Nikkei 225 Index rose by 0.5 percent, while Hong Kong's Hang Seng Index surged up by 1.1 percent.

As mentioned above, the major European markets are also seeing substantial strength on the day. While the U.K.'s FTSE 100 Index has jumped by 1.5 percent, the German DAX Index and the French CAC 40 Index are soaring by 2.9 percent and 3 percent, respectively.

In the bond market, treasuries are seeing further downside amid the rally on Wall Street. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 3.4 basis points at 1.963 percent.