Stocks Remain Firmly Positive Following Early Rally - U.S. Commentary

(RTTNews) - After moving sharply higher in early trading on Tuesday, stocks have continued to perform well over the course of the session. The strong gains on the day have largely offset the notable losses posted in the two previous sessions.

The major averages have pulled back off their best levels of the day but remain firmly positive. The Dow is up 230.65 points or 1.3 percent at 17,871.49, the Nasdaq is up 74.57 points or 1.6 percent at 4,739.28 and the S&P 500 is up 22.63 points or 1.1 percent at 2,050.89.

The strength on Wall Street is partly due to optimism about earnings after aluminum giant Alcoa (AA) kicked off the reporting season on an upbeat note.

After the close of trading on Monday, Alcoa reported fourth quarter adjusted earnings of $0.33 per share compared to analyst estimates for $0.27 per share.

The company also reported better than expected sales and forecast a seven percent increase in global aluminum demand in 2015.

Financial giants JP Morgan (JPM), Wells Fargo (WFC), Bank of America (BAC), Citigroup (C) and Goldman Sachs (GS) are among the companies due to report their quarterly results later in the week.

Meanwhile, traders seem unfazed by a modest drop by the price of crude oil, as crude for February delivery is down $0.24 at $45.83 a barrel but well off its worst levels.

The price of crude has staged a significant recovery after comments from the United Arab Emirates' oil minister indicating that OPEC does not plan to curb oil production contributed to an early decline.

Sector News

Biotechnology stocks are turning in some of the market's best performances in mid-day trading, resulting in a 2.8 percent jump by the NYSE Arca Biotechnology Index. With the gain, the index has reached a new record intraday high.

Pharmacyclics (PCYC) has helped to lead the biotech sector higher, surging up by 19.3 percent after providing upbeat guidance.

Significant strength also remains visible among airline stocks, as reflected by the 2.7 percent gain being posted by the NYSE Arca Airline Index. The strength in the sector may partly reflect optimism about lower jet fuel costs.

Utilities stocks are also seeing considerable strength on the day, with the Dow Jones Utilities Average advancing by 1.8 percent. The index has reached its best levels of the New Year but remains below the record highs set last month.

Tobacco, internet, software, and semiconductor stocks are also moving notably higher, while gold stocks are among the few sectors bucking the uptrend.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in another mixed performance during trading on Tuesday. Japan's Nikkei 225 Index fell by 0.6 percent, while Hong Kong's Hang Seng Index advanced by 0.8 percent.

Meanwhile, the major European markets all moved to the upside on the day. While the U.K.'s FTSE 100 Index rose by 0.6 percent, the French CAC 40 Index and the German DAX Index jumped by 1.5 percent and 1.6 percent, respectively.

In the bond market, treasuries are giving back some ground after trending higher in recent sessions. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 1.9 basis points at 1.931 percent.