U.S. Stocks Show Modest Advance To New Record Closing Highs

(RTTNews) - Stocks moved modestly higher over the course of the trading session on Monday, extending the upward trend seen over the past several sessions. With the continued advance, the major averages once again reached new record closing highs.

The major averages ended the day in positive territory but off their highs of the session. The Dow climbed 96.44 points or 0.3 percent to 28,551.53, the Nasdaq rose 20.69 points or 0.2 percent to 8,945.65 and the S&P 500 inched up 2.79 points or 0.1 percent to 3,224.01.

The continued strength on Wall Street came on the heels of news that China's Finance Ministry has announced plans to lower tariffs on a range of products, including frozen pork, pharmaceuticals and some high-tech components.

China said tentative import tax rates will be implemented for 859 types of products beginning January 1 in order to optimize the trade structure and promote high-quality economic development.

The tentative import tax rates, which were imposed on 706 types of products last year, are lower than the most-favored-nation tariffs.

The move by Beijing comes following the recent news that the U.S. and China have reached an agreement on a phase one trade deal.

Trading activity remained relatively subdued, however, with some traders looking to get a head start on the Christmas holiday.

Meanwhile, traders largely shrugged off a report from the Commerce Department showing an unexpected slump in durable goods orders, as the data comes from before the U.S. and China reached an agreement on a phase one trade deal.

The report said durable goods orders plunged by 2.0 percent in November after edging up by a downwardly revised 0.2 percent in October.

The sharp decline came as a surprise to economists, who had expected durable goods orders to jump by 1.5 percent compared to the 0.5 percent increase that had been reported for the previous month.

Excluding a nosedive in orders for transportation equipment, durable goods orders came in unchanged in November after rising by 0.3 percent in October. Economists had expected ex-transportation orders to tick up by 0.2 percent.

A separate report released by the Commerce Department showed a significant increase in U.S. new home sales in the month of November.

The Commerce Department said new home sales jumped by 1.3 percent to an annual rate of 719,000 after plunging by 2.7 percent to a revised rate of 710,000 in October.

Economists had expected new home sales to inch up by 0.1 percent to 734,000 from the 733,000 originally reported for the previous month.

Sector News

Oil service stocks moved sharply higher over the course of the trading session, driving the Philadelphia Oil Service Index up by 3.8 percent to its best closing level in five months.

The rally by oil service stocks came amid a modest increase by the price of crude oil, with crude for February delivery inching up $0.08 to $60.52 a barrel.

Substantial strength was also visible among gold stocks, which moved higher along with the price of the precious metal.

With gold for February delivery climbing $7.80 to $1,488.70, the NYSE Arca Gold Bugs Index surged up by 3.7 percent.

Natural gas stocks also saw considerable strength on the day, resulting in a 2.7 percent jump by the NYSE Arca Natural Gas Index.

Computer hardware and networking stocks also moved to the upside on the day, while some weakness emerged among utilities and housing stocks.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Monday. China's Shanghai Composite Index tumbled by 1.4 percent, while Japan's Nikkei 225 Index closed slightly higher and Hong Kong's Hang Seng Index inched up by 0.1 percent.

The major European markets also finished the day mixed. While the German DAX Index edged down by 0.1 percent, the French CAC 40 Index crept up by 0.1 percent and the U.K.'s FTSE 100 Index rose by 0.5 percent.

In the bond market, treasuries turned in a lackluster performance before closing modestly lower. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, ticked up by 1.8 basis points to 1.935 percent.

Looking Ahead

Trading activity is likely to remain relatively subdued on Tuesday, with the markets set to close early due to the upcoming Christmas holiday.