Stocks Seeing Modest Strength After Initial Upward Move - U.S. Commentary

(RTTNews) - Stocks moved to the upside at the start of trading on Monday, adding to the strong gains posted last week. The major averages jumped firmly into positive territory but have not seen much follow-through on the initial upward move.

The major averages have pulled back off their highs for the young session but are currently holding on to modest gains. The Dow is up 60.67 points or 0.4 percent at 15,196.51, the Nasdaq is up 9.04 points or 0.3 percent at 3,488.42 and the S&P 500 is up 5.75 points or 0.4 percent at 1,637.64.

The early strength on Wall Street came as traders continued to react positively to last Friday's monthly jobs report, which showed stronger than expected job growth in the month of July.

The increased optimism about the economic outlook seemed to overshadow concerns that the data may lead the Federal Reserve to begin scaling back its stimulus program.

Nonetheless, trading activity has remained somewhat subdued, as some traders remain away from their desks following last week's Independence Day holiday.

Uncertainty about the upcoming earnings season is also keeping some traders on the sidelines, with Alcoa (AA) scheduled to release its second quarter results after the close of trading.

The release of quarterly results from Alcoa is seen as the unofficial start of earnings season, as the aluminum giant is traditionally the first Dow component to report its results.

Most of the major sectors are showing only modest moves in early trading, although some strength is visible among banking, natural gas and pharmaceutical stocks.

In overseas trading, stock markets across the Asia-Pacific region came under pressure during trading on Monday. Japan's Nikkei 225 Index fell by 1.4 percent, while Hong Kong's Hang Seng Index ended the day down by 1.3 percent.

Meanwhile, the major European markets have shown notable moves to the upside on the day. While the U.K.'s FTSE 100 Index is up by 1.2 percent, the French CAC 40 Index is up by 1.9 percent and the German DAX Index is up by 2.3 percent.

In the bond market, treasuries are regaining some ground after falling sharply last Friday. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 4 basis points at 2.675 percent.