WASHINGTON (Alliance News) – Following the sell-off seen in the previous session, stocks are regaining some ground during trading on Friday. The Nasdaq and the S&P 500 are rebounding after ending Thursday’s trading at their lowest closing levels in a month.
Currently, the major averages remain in positive territory but off their best levels of the day. The Dow is up 34.62 points or 0.2% at 21,878.63, the Nasdaq is up 25.62 points or 0.4% at 6,242.49 and the S&P 500 is up 4.36 points or 0.2% at 2,442.57.
The strength on Wall Street is partly due to bargain hunting, with traders picking up stocks at reduced levels following the pullback seen over the past few sessions.
Positive sentiment was also generated by a report from the Labor Department showing a modest uptick in consumer prices in the month of July.
The Labor Department said its consumer price index inched up by 0.1% in July after coming in unchanged in June. Economists had expected prices to rise by 0.2%.
Excluding food and energy prices, core consumer prices still crept up by 0.1% in July, matching the increases seen in the three previous months. Core prices had also been expected to climb by 0.2%.
The smaller than expected increase in consumer prices has led to optimism that the Federal Reserve will not be in a hurry to raise interest rates.
Buying interest is somewhat subdued, however, as the ever-escalating war of words between President Donald Trump and North Korea continues to raise geopolitical concerns.
Trump suggested in remarks on Thursday that his comments threatening North Korea with “fire and fury” may not have been tough enough.
“I will tell you this, North Korea better get their act together or they’re going to be in trouble like few nations ever have been in trouble in this world,” Trump said.
Trump continued to ramp up the rhetoric with a post on Twitter this morning indicating that the US is prepared to take military action against North Korea.
“Military solutions are now fully in place, locked and loaded, should North Korea act unwisely. Hopefully Kim Jong Un will find another path!” Trump tweeted.
In an apparent response to Trump’s tweet, a statement issued by North Korea’s official KCNA news agency claimed the president is “driving the situation on the Korean peninsula to the brink of a nuclear war.”
Railroad stocks have shown a strong move to the upside on the day, driving the Dow Jones Railroads Index up by 1.3%. Genesee & Wyoming (GWR) is posting a notable gain after reporting an increase in July traffic.
Significant strength is also visible among computer hardware stocks, as reflected by the 1.1% advance by the NYSE Arca Computer Hardware Index. The index is bouncing off its lowest closing level in six months.
Data storage company Seagate Technology (STX) is posting a standout gain within the hardware sector, climbing by 2.1%.
Trucking and software stocks are also seeing notable strength in mid-day trading, while steel stocks have moved sharply lower on the day.
In overseas trading, stock markets across the Asia-Pacific region saw continued weakness during trading on Friday. Hong Kong’s Hang Seng Index plunged by 2%, while South Korea’s Kospi Index slumped by 1.7%. The Japanese markets were closed for a holiday.
The major European also saw further downside on the day. While the German DAX Index closed just below the unchanged line, the UK’s FTSE 100 Index and the French CAC 40 Index both tumbled by 1.1%.
In the bond market, treasuries are extending the upward move seen over the two previous sessions. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 2 basis points at 2.192%.
Copyright RTT News/dpa-AFX