After a failed recovery attempt in mid-morning trading on Friday, stocks are once again mostly lower in the early afternoon. Concerns about the looming fiscal cliff continue to weigh on investor sentiment, extending a recent downtrend for the markets.
The major averages have moved roughly sideways in recent trading, off their lows but stuck in negative territory. The Dow is down 59.33 points or 0.5 percent at 13,036.98, the Nasdaq is down 7.35 points or 0.3 percent at 2,978.56 and the S&P 500 is down 5.94 points or 0.4 percent at 1,412.16.
The weakness on Wall Street comes as traders are keeping a close eye on developments in Washington, as lawmakers are running out of time to reach an agreement to avoid the fiscal cliff.
With less than four days to go before the year-end deadline, President Barack Obama is scheduled to hold a meeting with Congressional leaders later this afternoon.
Senate Majority Leader Harry Reid, D-Nev., Senate Minority Leader Mitch McConnell, R-Ken., House Speaker John Boehner, R-Ohio, and House Minority Leader Nancy Pelosi, D-Calif., are all due to meet at the White House along with Vice President Joe Biden.
Stocks regained some ground following a report from Bloomberg News indicating that Obama intends to offer a "scaled-back budget offer" at the meeting.
Citing Democratic aides close to the talks, Bloomberg said the president's plan includes renewing the Bush-era tax cuts for the middle class, extending unemployment insurance benefits, heading off an expansion of the alternative minimum tax, and delaying or replacing parts of the scheduled spending cuts.
The markets were unable to sustain the upward move, however, as traders remained pessimistic about whether lawmakers will be able to reach an agreement.
Unless an agreement is reached, approximately $600 billion in automatic tax increases and government spending cuts are due to go into effect at the end of the year.
As a result of the focus on Washington, traders have largely shrugged off another batch of upbeat economic data, including a report from the National Association of Realtors showing that pending home sales rose to a two-year high in November.
Oil stocks have shown a notable move to the downside on the day, dragging the NYSE Arca Oil Index down by 1.3 percent. The loss extends a recent downward move by the index, which has pulled back well off the two-month closing high set last Thursday.
The weakness among oil stocks comes amid a modest decrease by the price of crude oil, with crude for February delivery sliding $0.29 to $90.58 a barrel.
Considerable weakness has also emerged among computer hardware stocks, as reflected by the 1.1 percent loss being posted by the NYSE Arca Computer Hardware Index. Computer giant Hewlett-Packard (HPQ) has helped to lead the sector lower, falling by 1.9 percent.
Oil service, networking, and chemical stocks are also seeing some weakness on the day, although selling pressure is relatively subdued.
In overseas trading, stock markets across the Asia-Pacific region moved to the upside during trading on Friday. Japan's Nikkei 225 Index rose 0.7 percent to its best closing level in well over a year, while Hong Kong's Hang Seng Index edged up by 0.2 percent.
Meanwhile, the major European markets turned lower over the course of the trading day. While the French CAC 40 Index tumbled by 1.5 percent, the German DAX Index and the U.K.'s FTSE 100 Index fell by 0.6 percent and 0.5 percent, respectively.
In the bond market, treasuries are seeing modest strength, extending the upward move seen in the previous session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by less than a basis point at 1.71 percent.
by RTT Staff Writer
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