Stocks continue to see modest strength in mid-day trading on Friday after recovering from an early move to the downside. The Dow and the S&P 500 have moved higher after closing lower for three consecutive sessions.
Currently, the major averages remain in positive territory. The Dow is up 11.45 points or 0.1 percent at 21,408.74, the Nasdaq is up 19.08 points or 0.3 percent at 6,255.76 and the S&P 500 is up 5.16 points or 0.2 percent at 2,439.66.
The modest strength on Wall Street comes following the release of a report from the Commerce Department showing a rebound in new home sales in the month of May.
The Commerce Department said new home sales climbed by 2.9 percent to an annual rate of 610,000 in May from the upwardly revised April rate of 593,000.
Economists had expected new home sales to jump by 5.4 percent to a rate of 600,000 from the 569,000 originally reported for the previous month.
Buying interest may also have been generated by an increase by the price of crude oil, with crude for August delivery rising $0.35 to $43.09 a barrel. The price of crude is climbing further off the ten-month low set on Wednesday.
Lingering uncertainty about the near-term outlook for the markets has kept trading activity somewhat subdued, however, with some traders sticking to the sidelines going into the first weekend of the summer.
Traders also continue to digest the details of the Senate Republican plan to repeal and replace Obamacare that was unveiled on Thursday.
Healthcare stocks initially responded positively to the release of the draft of the bill on Thursday but gave back ground after four Republican Senators said they cannot support the plan in its current form.
Senate Majority Leader Mitch McConnell, R-Ken., has little margin for error with the bill, as he can only afford to lose the support of two Republicans and still pass the legislation.
Sector News
Natural gas stocks have shown a strong move to the upside on the day, resulting in a 1.9 percent advance by the NYSE Arca Natural Gas Index. The index continues to recover after hitting its lowest closing level in over a year on Wednesday.
QEP Resources (QEP), Range Resources (RRC), and Cabot Oil & Gas (COG) are turning in some of the sector's best performances amid an increase by the price of natural gas.
Significant strength is also visible among gold stocks, as reflected by the 1.3 percent gain being posted by the NYSE Arca Gold Bugs Index. The strength in the gold sector comes as gold for August delivery is climbing $8 to $1,257.40 an ounce.
Steel stocks are also seeing notable strength, with U.S. Steel (X) and AK Steel (AKS) leading the way higher after Deutsche Bank upgraded its ratings on both stocks to Buy from Hold.
Networking, tobacco, and electronic storage stocks have also moved to the upside on the day, while biotechnology stocks are giving back some ground following recent strength.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region turned in another mixed performance during trading on Friday. Japan's Nikkei 225 Index crept up by 0.1 percent, while Hong Kong's Hang Seng Index closed just below the unchanged line.
Meanwhile, the major European markets all moved to the downside on the day. While the German DAX Index fell by 0.5 percent, the French CAC 40 Index and the U.K.'s FTSE 100 Index dipped by 0.3 percent and 0.2 percent, respectively.
In the bond market, treasuries continue to show a lack of direction after closing roughly flat for two straight days. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is unchanged at 2.153 percent.
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