After failing to sustain an initial upward move, stocks have shown a lack of direction over the course of the trading session on Friday. The major averages have been bouncing back and forth across the unchanged line.
Currently, the major averages are posting modest losses. The Dow is down 97.62 points or 0.4 percent at 23,762.84, the Nasdaq is down 17.05 points or 0.3 percent at 6,760.11 and the S&P 500 is down 4.98 points or 0.2 percent at 2,576.02.
Bargain hunting contributed to the initial strength on Wall Street after the steep losses seen in the previous session dragged the major averages down to their lowest levels in about two months.
Traders may also have reacted positively to news that lawmakers managed to end a brief government shutdown with a bill raising spending caps and funding the government until March 23rd.
Buying interest waned shortly after the start of trading, however, with concerns about the outlook for interest rates continuing to weigh on the markets.
Recent signs of rising inflation have led to worries that the Federal Reserve may raise rates faster than previously anticipated.
Traders have largely shrugged off a report from the Commerce Department showing wholesale inventories increased by more than expected in the month of December.
The Commerce Department said wholesale inventories rose by 0.4 percent in December after climbing by a revised 0.6 percent in November. Economists had expected inventories to edge up by 0.2 percent.
Most of the major sectors are showing only modest moves on the day, contributing to the lack of direction being shown by the broader markets.
Utilities stocks are seeing considerable strength, however, with the Dow Jones Utilities Average soaring by 1.2 percent. The average is bouncing off its lowest closing level in over a year.
Technology stocks have also moved to the upside, while energy stocks are moving lower amid a steep drop by the price of crude oil.
In overseas trading, stock markets across the Asia-Pacific region followed Wall Street sharply lower on Friday. Japan's Nikkei 225 Index plunged by 2.3 percent, while Hong Kong's Hang Seng Index crashed by 3.1 percent.
The major European markets also showed notable moves to the downside. While the French CAC 40 Index slumped by 1.4 percent, the U.K.'s FTSE 100 Index and the German DAX Index both tumbled by 1.3 percent.
In the bond market, treasuries have shown a lack of direction over the course of the session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by less than a basis point at 2.844 percent.
by RTT Staff Writer
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