Stocks moved to the downside at the start of trading on Wednesday, giving back some ground after moving mostly higher over the course of the three previous sessions. The major averages slipped into negative territory but have not seen much follow-through on the initial downward move.
The early weakness on Wall Street is partly due to profit taking, with some traders cashing in on the recent strength in the markets.
Additionally, while optimism about the possibility of further monetary stimulus contributed to the recent strength on Wall Street, Dallas Federal Reserve President Richard Fisher put a damper on those hopes in an interview with Bloomberg.
Fisher suggested that the Fed has done its job regarding providing the necessary economic stimulus and said that it is now up to the private sector. He also said that Congress needs to address the fiscal policy uncertainty in order for the liquidity in the system to be put to work.
Electronic storage stocks have shown a notable downward move in early trading, dragging the NYSE Arca Disk Drive Index down by 1.2 percent. STEC Inc. (STEC) has helped to lead the sector lower after reporting a wider than expected second quarter loss and providing disappointing guidance.
Commercial real estate, internet, and utilities stocks are also seeing moderate weakness, although selling pressure remains subdued. On the other hand, airline stocks are seeing considerable strength, moving higher along with gold and steel stocks.
The major averages have bounced off their lows for the young session but currently remain in the red. The Dow is down 15.22 points or 0.1 percent at 13,153.38, the Nasdaq is down 8.81 points or 0.3 percent at 3,007.05 and the S&P 500 is down 2.78 points or 0.2 percent at 1,398.57.
by RTT Staff Writer
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