Stocks continue to turn in a lackluster performance in mid-day trading on Wednesday, with traders largely staying on the sidelines. Uncertainty about the near-term outlook for the markets is contributing to the choppy trading on Wall Street.
The major averages are currently turning in a mixed performance, with the Nasdaq posting a modest gain. While the Nasdaq is up 3.50 points or 0.1 percent at 3,077.65, the Dow is down 35.61 points or 0.3 percent at 13,134.58 and the S&P 500 is down 2.17 points or 0.2 percent at 1,403.35.
The lack of direction being shown by stocks comes as traders seem reluctant to make any significant moves following the substantial advance seen over the past several months, which lifted the major averages to multi-year highs.
While recent indicators have pointed to a continued recovery by the U.S. economy, some analysts believe the markets need to stage a temporary correction before they can see any further upside.
At the same time, traders have largely seemed hesitant to cash in on the recent gains amid concerns that stocks could leg up further on more upbeat data.
Nonetheless, traders have largely shrugged off the release of a report from the National Association of Realtors showing a modest drop in existing home sales in the month of February.
NAR said existing home sales slipped 0.9 percent to a seasonally adjusted annual rate of 4.59 million in February from an upwardly revised 4.63 million in January. Economists had expected existing home sales to edge up to 4.61 million from the 4.57 million that had been reported for the previous month.
The modest drop in existing home sales in February came after sales surged up by an upwardly revised 5.7 percent in January. The revised figure for January represents the highest level since May of 2010.
Among individual stocks, shares of Oracle (ORCL) have turned lower on the day even though the business software giant reported stronger than expected adjusted third quarter earnings amid a notable increase in new software license revenues.
Business uniform supplier Cintas (CTAS) is also trading lower despite reporting better than expected third quarter earnings and raising its full year earnings guidance above analyst estimates.
While most of the major sectors are showing only modest moves, considerable weakness is visible among oil service stocks. The Philadelphia Oil Service Index has fallen by 1.5 percent, with the weakness in the sector coming in spite of an increase by the price of crude oil.
Baker Hughes (BHI) is leading the oil service sector lower after forecasting a sequential drop in its first quarter operating profit due to a shift away from natural gas production. Shares of Baker Hughes are down by 4.3 percent.
Steel stocks have also come under pressure on the day, extending the downward move seen in the previous session. Reflecting the weakness in the steel sector, the NYSE Arca Steel Index is down by 1.3 percent, pulling back further off the one-month closing high it set on Monday.
Meanwhile, housing stocks continue to see strength on the day despite the unexpected drop in existing home sales. Masco (MAS) is turning in one of the housing sector's best performances, advancing by 4.7 percent to a nine-month intraday high.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Wednesday. While Japan's Nikkei 225 Index ended the day down by 0.6 percent, China's Shanghai Composite Index crept up by 0.1 percent.
The major European markets have also turned mixed over the course of the trading day. The French CAC 40 Index has edged down by 0.1 percent, while the U.K.'s FTSE 100 Index and the German DAX Index are both up by 0.1 percent.
In the bond market, treasuries have moved notably higher on the day, climbing further off their recent lows. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 6.2 basis points at 2.31 percent.
by RTT Staff Writer
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