U.S. Stocks Move Modestly Higher After Initially Lacking Direction

(RTTNews) - Stocks showed a lack of direction in early trading on Monday but have moved modestly higher over the course of the session. The major averages have all moved to the upside, extending the significant rebound seen last Friday.

In recent trading, the Nasdaq and the S&P 500 have reached new highs for the session. The Nasdaq is up 72.57 points or 0.5 percent at 16,321.09, the S&P 500 is up 14.58 points or 0.3 percent at 5,218.92 and the Dow is up 63.09 points or 0.2 percent at 38,967.13.

The strength on Wall Street comes as traders continue to pick up stocks at relatively reduced levels following the steep drop seen last Thursday, which dragged the Dow down to its lowest closing level in a month.

While the major averages showed a strong move back to the upside during last Friday's session, the major averages still closed lower for the week.

The Dow plunged by 2.3 percent last week, while the S&P 500 slumped by 1.0 percent and the Nasdaq slid by 0.8 percent.

Trading activity remains somewhat subdued, however, as some traders are sticking to the sidelines ahead of the release of closely watched inflation data later in the week.

Some investors may also be away from their desks as they travel to other parts of the country to get a better view of today's total solar eclipse.

The Labor Department is scheduled to release its reports on consumer and producer inflation in the month of March on Wednesday and Thursday, respectively.

Economists currently expect consumer prices to rise by 0.3 percent in March following a 0.4 percent increase in February.

Core consumer prices, which exclude food and energy prices, are also expected to climb by 0.3 percent in March after rising by 0.4 percent in February.

The annual rate of consumer price growth is expected to accelerate to 3.4 percent in March from 3.2 percent in February, while the annual rate of core consumer price growth is expected to slow to 3.7 percent for 3.8 percent.

Producer prices are expected to rise by 0.3 percent in March after climbing by 0.6 percent in February, while the annual rate of producer growth is expected to jump to 2.3 percent from 1.6 percent.

The inflation data could have a significant impact on the outlook for interest rates, as Federal Reserve officials have repeatedly said they need greater confidence inflation is slowing before cutting rates.

Wednesday will also see the release of the minutes of the Fed's latest monetary policy meeting, which could also shed additional light on officials' thinking on rates.

Sector News

Airline stocks are turning in some of the market's best performances on the day, with the NYSE Arca Airline Index soaring by 2.4 percent.

Significant strength is also visible among steel stocks, as reflected by the 1.5 percent gain being posted y the NYSE Arca Steel Index.

Banking stocks have also shown a strong move to the upside, driving the KBW Bank Index up by 1.2 percent.

Semiconductor and commercial real estate stocks have also moved higher, while gold stocks are giving back ground amid a modest pullback by the price of the precious metal.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher on Monday. Japan's Nikkei 225 Index advanced by 0.9 percent and Hong Kong's Hang Seng Index inched up by 0.1 percent, although China's Shanghai Composite Index bucked the uptrend and slid by 0.7 percent.

The major European markets have also moved to the upside on the day. While the U.K.'s FTSE 100 Index has risen by 0.3 percent, the German DAX Index and the French CAC 40 Index are up by 0.7 percent and 0.8 percent, respectively.

In the bond market, treasuries are extending the notable downward move seen last Friday. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 4.4 basis points at 4.422 percent.