(RTTNews) - Stocks are steadily building on their earlier gains in mid-afternoon trading on Monday, as accommodative government policies and a rosy economic outlook have spurred buying interest. The major averages are all in positive territory, with the Dow on pace to set a fresh one-year closing high.

The markets have benefited from indications by G20 finance ministers that economic stimulus measures will remain in place until the global economic recovery is assured, including record low interest rates in the U.S.

With no first tier economic data on the day, traders have also looked to some corporate news to guide some of their moves.

British chocolate giant Cadbury Plc (CBY) rejected the latest purchase offer from Kraft Foods (KFT), calling the proposal ‘derisory’ and noting it is worse than a previous offer due to the drop in the Kraft share price since September.

Earlier in the day, Dish Network (DISH) reported third quarter net income of $81 million, compared with $92 million in the corresponding period in 2008. Total revenue was $2.892 billion, down 1.5 percent from $2.937 billion in the year-ago quarter. Nonetheless, the stock is currently up by 4.5 percent.

In other news, defense contractor Northrop Grumman (NOC) announced that it has agreed to sell its advisory services business TASC, Inc. to a consortium led by General Atlantic LLC and affiliates of Kohlberg Kravis Roberts for $1.65 billion in cash. Shares of Northrop Grumman are currently up by 2.7 percent.

The major averages have seen some further upside in recent trading, once again reaching new highs for the session. The Dow is currently up 194.08 at 10,217.50, the Nasdaq is up 37.84 at 2,150.28 and the S&P 500 is up 22.07 at 1,091.37.

Dow Components

Nearly all of the Dow components are moving higher, contributing to the strong triple digit gain being shown by the blue chip index.

American Express (AXP) is one of the Dow’s best performers, rising by 4.8 percent. With the gain, the stock is on pace to close at its best level in over a year.

Caterpillar (CAT) and Travelers (TRV) are also moving notably higher, posting gains of 4.3 percent and 3.3 percent, respectively. Caterpillar is looking to close at its highest price in over a year, while Travelers is poised to end the day at its best price in nearly two years.

Bank of America (BAC), General Electric (GE), Boeing (BA) and DuPont (DD) are also on the rise, while Kraft is the only loser in the Dow, falling by 1.2 percent. The stock is offsetting recent gains following another rejection from Cadbury.

Sector News

Resource stocks continue to turn in strong performances in mid-afternoon trading, with the strength among metal and energy stocks precipitated by strong upward moves in commodities prices on the NYMEX.

Banking stocks are also on the rise, with the Kbw Bank Index up by 3 percent, recovering from last week’s three-month closing low.

The index is being helped by shares of Fifth Third Bancorp (FITB), which are up by 5.8 percent. The upward move is also helping the stock erase recent losses after lingering near a multi-month low set late last month.

Commercial real estate, electronic storage, semiconductor and airline stocks are also posting notable gains, although they remain rangebound as they recover from the losses posted in late October.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region closed higher on Monday. Japan’s benchmark Nikkei 225 Index edged up by 0.2 percent, while Hong Kong’s Hang Seng Index advanced 1.7 percent.

The major European markets also closed notably higher, with the U.K.’s FTSE 100 and the French CAC 40 Index both gaining 2.1 percent, while the German DAX Index rose by 2.4 percent.

In the bond markets, treasuries are modestly higher following the strong results of today’s $40.0 billion three-year note auction. Subsequently, the yield on the benchmark ten-year note is trading at 3.480 percent, posting a loss of 2.0 basis points.

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Posted in Categories: Economy, Eurozone, Japan, Releases, UK, USA.

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