RTTNews - Stocks are posting notable gains in mid-morning trading on Wednesday, as traders are doing some bargain hunting following yesterday's sharp pullback. The major averages are all in positive territory by moderate margins, offsetting part of Tuesday's steep losses.

Dow component Alcoa (AA) is set to kick off earnings season when it reports it second quarter results after the close of trading today. The aluminum producer is expected to incur a loss in contrast to a year-ago profit.

Traders are digesting data from the Energy Information Administration indicating that oil inventories fell by 2.9 million barrels last week after seeing a drop of 3.7 million barrels in the previous week. The price of oil for August delivery is currently down by $1.36 to $61.57, declining for the sixth straight session.

Later today, the focus of the broader markets is likely to shift to the Treasury Department's auction of ten-year notes amid the recent concerns over interest rates.

In recent earnings news, restaurant operator Ruby Tuesday (RT) said Tuesday after the markets closed that its fourth quarter profit rose 3.7 percent from last year, as lower operating costs and expenses helped offset a 7.1 percent decline in revenue.

Today, Pepsi Bottling Group (PBG) reported adjusted second quarter net income of $172 million or $0.78 per share, compared to $174 million or $0.78 per share in the year-ago quarter. Analysts expected the firm to report earnings of $0.73 per share for the quarter.

Family Dollar Stores (FDO) reported third-quarter net income of $87.72 million or $0.62 per share, compared to $64.67 million or $0.46 per share last year. Wall Street analysts expected the company to report earnings of $0.59 per share, while net sales of $1.84 billion came in line with estimates.

In other news, internet search provider Google (GOOG) revealed that it is developing the Google Chrome Operating System in a bid to challenge the Windows Operating System of Microsoft (MSFT).

The major averages have pulled back well off their highs for the session in recent trading but are currently holding onto modest gains. The Dow is currently up 27.28 at 8,190.88, the Nasdaq is up 2.58 at 1,748.75 and the S&P 500 is up 1.10 at 882.12.

Sector News

Pharmaceutical and biotechnology stocks are showing strong gains on the day, as reflected by the 1.8 percent climb being shown by the NYSE Arca Pharmaceutical Index and the 1.1 percent gain being posted by the NYSE Arca Biotechnology Index.

While the pharmaceutical index remains within a range, the biotechnology index is bouncing off of a one-month closing low set in the previous session.

Leading the way higher are shares of Amgen (AMGN), which have surged up by 16.1 percent, rising to their best intraday price in over eight months. The move comes as the firm said a Phase 3 trial evaluating Denosumab in the treatment of bone metastases in patients with advanced breast cancer met its expectations and demonstrated superior efficacy compared to Zometa.

Defense, airline and utilities stocks are also seeing a strong outing. Notably, The NYSE Arca Defense Index is up 1.1 percent, moving off of a roughly two-month closing low set on Tuesday.

Meanwhile, health insurance stocks are ceding some ground after yesterday's rally, with the Morgan Stanley Healthcare Payor Index dropping by 2.9 percent on the day. Networking and gold stocks are also retreating.

Stocks Driven By Analyst Comments

Photronics (PLAB) is on the rise in mid-morning trading after being upgraded by UBS to Buy from Neutral. The stock is up by 8.3 percent, climbing to its best level in just over eleven months.

Shares of (DRYS) are also advancing following an upgrade by Credit Suisse from Underperform to Outperform. The rating change has precipitated the 6.7 percent gain on the day, which is helping the stock move off of a three-month closing low set on Tuesday.

On the other hand, SciClone Pharmaceuticals (SCLN) is slipping after BWS Financial lowered its rating on the stock to Hold from Buy. Shares of the biopharmaceutical firm are down by 9.7 percent, moving off of its best closing price in over two years set in the previous session.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region ended Wednesday's session lower. Japan's benchmark Nikkei 225 Index closed down by 2.4 percent, while Hong Kong's Hang Seng Index dipped by 0.8 percent on the day.

Meanwhile, the major European markets are turning in a mixed performance. While the German DAX Index is up by 0.5 percent, the French CAC 40 Index and the U.K.'s FTSE 100 Index are down by 0.2 percent and 0.4 percent respectively.

In the bond markets, treasuries are holding onto thin gains. Subsequently, the yield on the benchmark ten-year note is trading at 3.449 percent, a loss of 1.1 basis points on the day.

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