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Stock Market Update for 06/28/2011

June 28, 2011

stock market updateAfter turning in a strong performance in the previous session, stocks are seeing some further upside in early trading on Tuesday. The major averages have all shown strong upward moves, with the tech-heavy Nasdaq rising to a three-week high.

The major averages have pulled back off their highs for the young session in the past few minutes but remain positive. The Dow is up 63.84 points or 0.5 percent at 12,107.40, the Nasdaq is up 16.19 points or 0.6 percent at 2,704.47 and the S&P 500 is up 6.82 points or 0.5 percent at 1,286.92.

The early strength on Wall Street is partly due to continued optimism about a resolution to the Greek debt crisis, with the Greek Parliament due to vote on a crucial package of austerity measures on Wednesday.

Buying interest has also been generated by news that the U.S. has voiced its support for French Finance Minister Christine Lagarde’s bid for the position of head of the International Monetary Fund.

If Lagarde is officially named to the position, it would eliminate some of the uncertainty generated by the resignation of the IMF’s former Managing Director Dominique Strauss-Kahn, who resigned in May amid allegations that he sexually assaulted a hotel maid.

However, the Conference Board recently released its report on consumer confidence in the month of June, showing an unexpected drop in consumer confidence for the month.

The report, which was released ahead of schedule, showed that the consumer confidence index fell to 58.5 in June from 61.7 in May. Economists had been expecting the index to edge up to 62.0 from the 60.8 originally reported for the previous month.

Nonetheless, oil service stocks are seeing considerable strength in early trading, benefiting from a rebound by the price of crude oil. With crude for August delivery rising $0.59 to $91.20 a barrel, the Philadelphia Oil Service Index is up by 2 percent.

Networking, electronic storage, and health insurance stocks are also seeing early strength, while moderate weakness has emerged among tobacco and airline stocks.

In overseas trading, stock markets across the Asia-Pacific region closed mostly higher on Tuesday after seeing weakness in the previous session. Japan’s benchmark Nikkei 225 Index rose by 0.7 percent, while Hong Kong’s Hang Seng Index edged up by 0.1 percent.

The major European markets are also moving to the upside on the day. The German DAX Index is up by 0.3 percent, while the U.K.’s FTSE 100 Index and the French CAC 40 Index have advanced by 0.9 percent and 1.2 percent, respectively.

In the bond market, treasuries are seeing modest weakness, extending the downward move seen over the course of the previous session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 2.2 basis points at 2.949 percent.

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