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U.S. Stocks Pull Back Near Unchanged Line After Seeing Initial Strength

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After failing to sustain an early move to the upside, stocks have given back some ground over the course of the trading day on Friday. The major averages have pulled back off their highs of the session, with the Nasdaq and the S&P 500 dipping into negative territory.

Currently, the major averages are turning in a mixed performance. While the Dow is up 42.41 points or 0.2 percent at 27,265.38, the Nasdaq is down 3.42 points or less than a tenth of a percent at 8,203.82 and the S&P 500 is down 1.51 points or 0.1 percent at 2,993.60.

The initial strength in Wall Street partly reflected a positive reaction to upbeat earnings news from Microsoft (MSFT), with the software giant climbing by 1.5 percent.

The advance by Microsoft comes after the company reported fiscal fourth quarter results that exceeded analyst estimates on both the top and bottom lines.

Buying interest waned shortly after the start of trading, however, as traders look ahead to the slew of earnings news due to be released next week.

Coca-Cola (KO), Travelers (TRV), Visa (V), AT&T (T), Boeing (BA), Caterpillar (CAT), UPS (UPS), Facebook (FB), Ford (F), 3M (MMM), Alphabet (GOOGL), Intel (INTC), McDonald's (MCD), and Twitter (TWTR) are among the companies due to report their quarterly results.

Traders are also digesting the New York Federal Reserve's efforts to walk back comments President John Williams made Thursday that seemed to endorse a near-term interest rate cut.

Williams said it "pays to act quickly to lower rates at the first sign of economic distress," arguing it is "better to take preventative measures than to wait for disaster to unfold."

However, a New York Fed spokesman later claimed Williams' remarks were based on years of research and not specifically about potential policy actions at the upcoming Fed meeting.

Sector News

Reflecting the lackluster performance being turned in by the broader markets, most of the major sectors are showing only modest moves in mid-day trading.

Gold stocks are pulling back sharply, however, with the NYSE Arca Gold Bugs Index plunging by 2.2 percent after spiking by 3.2 percent to a nearly two-year closing high on Thursday.

The pullback by gold stocks comes as the price of gold for August delivery is nearly unchanged after surging to a six-year high of $1,454.40 an ounce earlier in the session.

Considerable weakness has also emerged among biotechnology stocks, as reflected by the 1.3 percent drop by the NYSE Arca Biotechnology Index.

Commercial real estate stocks have also moved to the downside on the day, while some strength remains visible among steel and transportation stocks.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved significantly higher during trading on Friday. Japan's Nikkei 225 Index soared by 2 percent, while Hong Kong's Hang Seng Index jump by 1.1 percent.

The major European markets showed more modest moves to the upside on the day. While the French CAC 40 Index closed just above the unchanged line, the U.K.'s FTSE 100 Index edged up by 0.2 percent and the German DAX Index rose by 0.3 percent.

In the bond market, treasuries have shown a lack of direction over the course of the session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by less than a basis point at 2.043 percent.

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