Stocks are turning in a lackluster performance in late morning trading on Monday after moving to the downside last week. While concerns about the impact of recent European elections have generated some negative sentiment, selling pressure has remained subdued.
The markets saw early weakness amid a negative reaction to election results in France and Greece, which some consider a setback to the progress achieved thus far on the European debt crisis.
Francois Hollande won a run-off election against French President Nicolas Sarkozy and will become France's first Socialist president since 1995.
Hollande has expressed significant opposition to using austerity measures to address the European debt crisis, arguing that the focus should be more on economic growth than cutting government spending.
Additionally, the results of Greek elections pointed to a hung parliament, with no single party getting adequate votes to form a government. Many Greek voters turned to anti-bailout parties.
Oil service stocks are seeing substantial weakness on the day, resulting in a 2.3 percent drop by the Philadelphia Oil Service Index. The weakness in the sector comes as the price of crude oil is extending a recent downward move, pulling back further below the $100 a barrel level.
Significant weakness is also visible among gold stocks, which are moving lower along with the price of the precious metal. Natural gas stocks have also come under pressure, while airline stocks have shown a strong move to the upside.
The major averages are currently turning in a mixed performance, with the tech-heavy Nasdaq posting a modest gain. While the Nasdaq is up 1.87 points or 0.1 percent at 2,958.21, the Dow is down 29.55 points or 0.2 percent at 13,008.72 and the S&P 500 is down 0.98 points or 0.1 percent at 1,368.12.
by RTT Staff Writer
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