Stocks Rally As Traders Look For Bargains - U.S. Commentary

(RTTNews) - Stocks moved sharply higher during trading on Monday, regaining some ground following the weakness seen in recent sessions. Trading activity was somewhat subdued, however, potentially exaggerating the upward move.

The major averages moved roughly sideways going into the close, hovering firmly in positive territory. The Dow soared 241.79 points or 1.4 percent to 17,615.17, the Nasdaq jumped 58.25 points or 1.2 percent to 5,101.80 and the S&P 500 surged up 26.61 points or 1.3 percent to 2,104.18.

The rally on Wall Street was partly due to bargain hunting on the heels of the weakness seen throughout much of last week.

The gain by the Dow came after the blue chip index closed lower for seven consecutive sessions, ending last Friday's trading at a six-month closing low.

Buying interest was also generated by renewed optimism about an end to the seemingly endless Greek debt crisis.

Greece's finance minister reportedly hopes to conclude negotiations on a third bailout deal by early Tuesday to prevent the country from defaulting on bond payments owed to the European Central Bank.

Gold stocks moved sharply higher on the day, driving the NYSE Arca Gold Bugs Index up by 7 percent. With the gain, the index climbed further off the twelve-year closing low set last Wednesday.

The rally by gold stocks came amid an increase by the price of the precious metal, with gold for December delivery rising $10 to $1,104.10 an ounce.

Similarly, energy stocks moved higher along with the price of crude oil, as crude for September delivery jumped $1.09 to $44.96 a barrel.

Reflecting the strength in the energy sector, the Philadelphia Oil Service Index soared by 4.7 percent, while the NYSE Arca Natural Gas Index and the NYSE Arca Oil & Gas Index surged up by 3/6 percent and 3.1 percent, respectively.

Most of the other major sectors also moved notably higher on the day, with considerable strength visible among steel, electronic storage, telecom and semiconductor stocks.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in another mixed performance on Monday. Japan's Nikkei 225 Index rose by 0.4 percent, while Hong Kong's Hang Seng Index edged down by 0.1 percent.

Meanwhile, the major European markets all moved to the upside on the day. While the U.K.'s FTSE 100 Index climbed by 0.3 percent, the French CAC 40 Index advanced by 0.8 percent and the German DAX Index jumped by 1 percent.

In the bond market, treasuries pulled back rather sharply amid the rally on Wall Street. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, surged up by 6.3 basis points to 2.238 percent.

Looking Ahead

Trading on Tuesday may be impacted by reaction to reports on labor productivity and costs and wholesale inventories.