With traders cashing in on the strong gains posted in the previous session, stocks have moved mostly lower during trading on Friday. The major averages have slide firmly into negative territory, although selling pressure has waned from earlier in the session.
Lingering concerns about the financial situation in Europe are weighing on the markets, with traders awaiting the release of results of stress tests of Spanish banks.
Further selling pressure was generated by a report from the Institute for Supply Management - Chicago showing an unexpected contraction in Chicago-area business activity in the month of September.
The ISM Chicago said its business barometer dropped to 49.7 in September from 53.0 in August, with a reading below 50 indicating a contraction in business activity. With the drop, the barometer fell to its lowest level in three years.
Networking stocks are seeing considerable weakness in late morning trading, resulting in a 1.5 percent loss by the NYSE Arca Networking Index. Adtran (ADTN) is leading the sector lower after cutting its third quarter guidance.
Significant weakness is also visible among steel stocks, as reflected by the 1.4 percent loss being posted by the NYSE Arca Steel Index. Trucking, housing, and brokerage stocks are also posting notable losses.
The major averages have moved roughly sideways in recent trading, stuck in the red. The Dow is down 94.50 points or 0.7 percent at 13,391.47, the Nasdaq is down 20.17 point or 0.6 percent at 3,116.43 and the S&P 500 is down 9.67 points or 0.7 percent at 1,437.48.
by RTT Staff Writer
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