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Stocks Close Little Changed After Another Lackluster Session - U.S. Commentary


Following the lackluster performances seen in the two previous sessions, stocks continued to show a lack of direction during trading on Monday. The major averages once again spent the day bouncing back and forth across the unchanged line.

The major averages eventually ended the day little changed. While the Nasdaq inched up 0.53 points or less than 0.1 percent to 5,901.53, the Dow edged down 8.76 points or less than 0.1 percent to 20,905.86 and the S&P 500 dipped 4.78 points or 0.2 percent to 2,373.47.

The choppy trading on Wall Street came as many traders stuck to the sidelines amid a quiet day on the U.S. economic front.

The economic calendar remains relatively light throughout the week, although traders are likely to keep an eye on reports on new and existing home sales and durable goods orders.

Speeches by a number of Federal Reserve officials may also attract attention this week after the central bank's decision to raise interest rates by a quarter point last week.

In an interview on CNBC's "Squawk Box," Minneapolis Fed President Neel Kashkari said he voted against the rate hike because inflation is still below the central bank's 2 percent target.

Meanwhile, traders largely shrugged off disappointment with the outcome of the G20 meeting, where finance ministers failed to agree on a commitment to keep global trade free and open.

The token reference to trade in the G20 communique was seen as a reflection of President Donald Trump's more protectionist policies.

Among individual stocks, shares of Esperion Therapeutics (ESPR) moved sharply higher after the lipid management company said the FDA confirmed that its LDL-C lowering program is adequate to support approval of an LDL-C lowering indication for bempedoic acid.

Aralez Pharmaceuticals (ARLZ) also posted a strong gain following news CEO Adrian Adams acquired an additional 500,000 shares of the specialty pharmaceutical company's common stock.

Meanwhile, Aevi Genomic Medicine (GNMX) saw substantial weakness after revealing a SAGA trial of AEVI-001 in adolescents with mGluR mutation positive ADHD did not meet its primary endpoint.

Sector News

Most of the major sectors ended the day showing only modest moves, contributing to the lackluster performance by the broader markets.

Biotechnology stocks showed a substantial move to the upside, however, with the NYSE Arca Biotechnology Index surging up by 2 percent. The jump lifted the index to its best closing level in over a year.

Within the biotech sector, Nektar Therapeutics (NKTR) posted a standout gain after announcing positive results from a study of its new opioid pain medication.

Significant strength also emerged among gold stocks, as reflected by the 1.4 percent gain posted by the NYSE Arca Gold Bugs Index. The strength in the sector came as gold for April delivery rose $3.80 to $1,234 an ounce.

On the other hand, banking stocks came under pressure over the course of the session, dragging the Dow Jones Banks Index down by 1.3 percent. With the drop, the index fell to its lowest closing level in a month.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Monday. Hong Kong's Hang Seng Index climbed by 0.8 percent, while Australia's All Ordinaries Index fell by 0.4 percent. The Japanese markets were closed for a holiday.

The major European markets also finished the day mixed. While the U.K.'s FTSE 100 Index inched up by 0.1 percent, the French CAC 40 Index and the German DAX Index dipped by 0.3 percent and 0.4 percent, respectively.

In the bond market, treasuries moved to the upside on the day, extending a recent upward trend. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, dropped by 2.8 basis points to 2.473 percent.

Looking Ahead

Amid another quiet day on the U.S. economic front on Tuesday, traders are likely to keep an eye on speeches by several Federal Reserve officials.

Additionally, General Mills (GIS) and Lennar (LEN) are among the companies due to report their quarterly results before the start of trading.

by RTTNews Staff Writer

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