Stocks have moved mostly lower over the course of the trading day on Wednesday, giving back some ground after ending the previous session sharply higher. Selling pressure has remained subdued, however, limiting the downside for the markets.
While the advance-decline line shows a significant negative bias for stocks, the major averages are nearly flat. The Dow is up 14.57 points or 0.1 percent at 13,192.25, while the Nasdaq is down 0.93 points or less than a tenth of a percent at 3,038.95 and the S&P 500 is down 1.45 points or 0.1 percent at 1,394.50.
Profit taking is contributing to some weakness on Wall Street, although traders seem reluctant to make significant moves and miss out of any further upside for the markets.
Traders are also digesting the results of the Federal Reserve's stress tests, which showed that 15 of the 19 biggest banks subjected to the tests boasted adequate capital to weather a severe recession.
The results, which were released ahead of schedule, showed that only Citigroup (C), Sun Trust (STI), MetLife (MET) and Ally Financial did not make the grade.
The Fed's stress tests assessed the health of banks under adverse situations such as when the unemployment rate climbs to 13 percent and house prices drop by 21 percent.
The lack of conviction also comes as traders are looking ahead to the release of some key economic data later in the week, including reports on weekly jobless claims, industrial production, and producer and consumer price inflation.
Traders have largely shrugged off the release of a report from the Labor Department showing that U.S. import and export prices both increased by 0.4 percent in the month of February. The increase in import prices was largely due to a jump in fuel prices.
Among individual stocks, shares of Pacific Sunwear (PSUN) have tumbled by 13.9 percent after the apparel retailer reported an unexpected drop in fourth quarter sales and forecast a wider than expected first quarter loss.
Meanwhile, Books-A-Million (BAMM) has shown a strong upward move after reporting fourth quarter earnings and sales growth. Shares of Books-A-Million are up by 14.3 percent.
Sector News
Gold stocks have moved sharply lower over the course of the trading day, dragging the NYSE Arca Gold Bugs Index down by 3.5 percent. The loss extends a recent downward move by the index, which has fallen two a two-month intraday low.
The weakness among gold stocks comes amid a sharp drop by the price of the precious metal, with gold for April delivery tumbling $45.20 to $1,649 an ounce.
Significant weakness has also emerged among railroad stocks, as reflected by the 1.9 percent loss being posted by the Dow Jones Railroads Index. Norfolk Southern (NSC) and CSX Corp. (CSX) are turning in two of the sector's worst performances.
Oil service stocks have also come under pressure on the day, moving lower along with the price of crude oil. With crude for April delivery falling $0.71 to $106 a barrel, the Philadelphia Oil Service Index is down by 1.5 percent.
Electronic storage, airline, and housing stocks are also seeing notable weakness, while modest strength remains visible among banking and health insurance stocks.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher on Wednesday, although stocks in Hong Kong and mainland China bucked the uptrend. Japan's Nikkei 225 Index surged up by 1.5 percent, while Australia's All Ordinaries Index advanced by 0.9 percent.
Meanwhile, the major European markets have turned mixed on the day. While the U.K.'s FTSE 100 Index is just below the unchanged line, the French CAC 40 Index is up by 0.5 percent and the German DAX Index is up by 1.2 percent.
In the bond market, treasuries have moved sharply lower, extending the drop seen in the previous session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, has jumped 12.6 basis points to a four-month high of 2.233 percent.
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