With traders sitting on the sidelines amid uncertainty about the near-term outlook for the markets, stocks are showing a lack of direction in early trading on Friday. The major averages are lingering near the unchanged line after closing higher in the two previous sessions.
The major averages are currently turning in a mixed performance, with the Nasdaq posting a slim gain. While the Nasdaq is up 1.61 points or 0.1 percent at 3,123.37, the Dow is down 13.65 points or 0.1 percent at 13,457.57 and the S&P 500 is down 2.20 points or 0.2 percent at 1,469.92.
The choppy trading on Wall Street comes as traders seem reluctant to make any significant moves after the upward move seen on Thursday lifted the S&P 500 to a new five-year closing high.
Since earnings season is only just starting to pick up steam, traders are taking a wait-and-see approach as more big-name companies release their quarterly results in the coming weeks.
Traders are also digesting some mixed news from overseas. While news of a $116 billion stimulus package in Japan generated some positive sentiment, a report from China showing a bigger than expected acceleration in the pace of inflation suggested that the Chinese may not provide further stimulus.
While most of the major sectors are showing only modest moves, steel stocks have come under pressure on the news out of China. The NYSE Arca Steel Index is down by 1.6 percent, with Cliffs Natural Resources (CLF) helping to lead the way lower.
Banking and gold stocks are also seeing some early weakness, while notable strength has emerged among biotechnology stocks.
Among individual stocks, shares of Wells Fargo (WFC) have moved to the downside in early trading even though financial services giant reported fourth quarter earnings and revenues that exceeded analyst estimates.
Wells Fargo, the nation's largest mortgage lender, reported fourth quarter earnings of $0.91 per share on revenues of $21.9 billion. Analysts had expected the company to earn $0.89 per share on revenues of $21.3 billion.
On the other hand, shares of Infosys (INFY) have surged up by 18.3 percent after the software services provider reported better than expected third quarter results and raised its full-year revenue guidance.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Friday. Japan's Nikkei 225 Index surged up by 1.4 percent, while China's Shanghai Composite Index tumbled by 1.8 percent.
The major European markets have also turned mixed on the day. While the French CAC 40 Index has edged down by 0.1 percent, the U.K.'s FTSE 100 Index is up by 0.2 percent and the German DAX Index is just above the unchanged line.
In the bond market, treasuries have moved to the downside, pulling back toward their recent lows. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 2.7 basis points at 1.921 percent.
by RTT Staff Writer
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