Stocks are showing a lack of direction in early trading on Tuesday as traders express uncertainty about the near-term outlook for the markets following yesterday's sell-off. The major averages are lingering near the unchanged line.
The major averages are currently turning in a mixed performance, with the Nasdaq posting a slim gain. While the Nasdaq is up 3.01 points or 0.1 percent at 3,050.09, the Dow is down 23.84 points or 0.2 percent at 12,905.75 and the S&P 500 is down 1.49 points or 0.1 percent at 1,380.71.
The choppy trading comes as traders are staying on the sidelines ahead of the release of quarterly results from aluminum giant Alcoa (AA) after the close of trading.
Alcoa is typically the first Dow component to report its quarterly results, and the release of its results is seen as the unofficial start of the earnings season.
Following last Friday's disappointing jobs report, the strength of the early earnings reports may help to set the tone for the markets in the coming weeks.
Most of the major sectors are showing only modest moves in early trading, although health insurance stocks are extending the sharp drop seen on Monday. The Morgan Stanley Healthcare Payor Index is down by 1.2 percent after ending the previous session down by 7.2 percent.
Railroad, utilities, and trucking stocks are seeing more moderate weakness, while modest strength is visible among computer hardware, internet, and pharmaceutical stocks.
Among individual stocks, Supervalu (SVU) is moving notably higher after the supermarket operator reported better than expected adjusted fourth quarter earnings and forecast full-year earnings above analyst estimates. Shares of Supervalu are up by 12.2 percent.
On the other hand, shares of ViroPharma (VPHM) have come under pressure on news of the FDA's approval of generic versions of the company's drug Vancocin. ViroPharma is down by 19.4 percent in early trading.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Tuesday. While Japan's Nikkei 225 Index edged down by 0.1 percent, China's Shanghai Composite Index advanced by 0.9 percent.
Meanwhile, the major European markets have all moved to the downside on the day. The French CAC 40 Index is down by 1.8 percent, while the German DAX Index is down by 0.9 percent and the U.K.'s FTSE 100 Index is down by 0.8 percent.
In the bond market, treasuries are seeing modest strength, extending a recent upward move. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 1.1 basis points at 2.026 percent.
by RTT Staff Writer
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