Dow, Nasdaq Close Higher For Ninth Consecutive Session

(RTTNews) - Stocks moved mostly higher early in the session on Tuesday and saw continued strength throughout the trading day. With the upward move, the Dow and the Nasdaq extended their recent winning streaks to nine consecutive sessions.

The major averages saw further upside going into the close, reaching new highs for the session. The Dow advanced 251.90 points or 0.7 percent to a new record closing high of 37,557.92.

The Nasdaq climbed 98.03 points or 0.7 percent to 15,003.22 and the S&P 500 rose 27.81 points or 0.6 percent to 4,768.37, reaching their best closing levels in almost two years.

Optimism about the outlook for interest rates continued to contribute to strength on Wall Street following the Federal Reserve's monetary policy announcement last week.

While the Fed's latest projections pointed to three interest rate cuts next year, investors widely expect the central bank to lower rates more aggressively.

Adding to the positive sentiment, San Francisco Federal Reserve President Mary Daly said interest rate cuts are likely to be appropriate next year because of an improvement in inflation.

The Federal Reserve must make sure "we don't give people price stability but take away jobs," Daly told the Wall Street Journal in an interview.

CME Group's FedWatch Tool is currently indicating a 67.5 percent chance the Fed lowers rates by a quarter point in March 2024.

On the U.S. economic front, the Commerce Department released a report this morning unexpectedly showing a substantial increase in new residential construction in the U.S. in the month of November.

The report said housing starts soared by 14.8 percent to an annual rate of 1.560 million in November after inching up by 0.2 percent to a downwardly revised rate of 1.359 million in October.

The surge surprised economists, who had expected housing starts to decrease by 0.9 percent to an annual rate of 1.360 million from the 1.372 million originally reported for the previous month.

Meanwhile, the Commerce Department said building permits slumped by 2.5 percent to an annual rate of 1.460 million in November after jumping by 1.8 percent to an upwardly revised rate of 1.498 million in October.

Building permits, an indicator of future housing demand, were expected to fall by 1.1 percent to an annual rate of 1.470 million from the 1.487 million originally reported for the previous month.

Sector News

Gold stocks showed a substantial move to the upside on the day, driving the NYSE Arca Gold Bugs Index up by 2.9 percent to a five-month closing high.

The rally by gold stocks came amid an increase by the price of the precious metal, with gold for February delivery climbing $11.60 to $2,052.10 an ounce.

Considerable strength also emerged among brokerage stocks, resulting in a 2.1 percent jump by the NYSE Arca Broker/Dealer Index. With the advance, the index has reached record closing high.

Biotechnology, oil service and steel stocks also saw significant strength on the day, moving higher along with most of the other major sectors.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Tuesday. Japan's Nikkei 225 Index jumped by 1.4 percent, while Australia's S&P/ASX 200 Index advanced by 0.8 percent.

The major European markets also moved to the upside on the day. While the German DAX Index climbed by 0.6 percent, the U.K.'s FTSE 100 Index rose by 0.3 percent and the French CAC 40 Index inched up by 0.1 percent.

In the bond market, treasuries have rebounded following the pullback seen in the previous session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 2.8 basis points at 3.926 percent.

Looking Ahead

Trading on Wednesday may be impacted by reaction to the latest U.S. economic data, including reports on consumer confidence and existing home sales.