Stocks continue to show a lack of direction in mid-day trading on Wednesday, extending the sideways move seen over the past week. A mixed batch of U.S. economic data is contributing to the lackluster performance on Wall Street.
The major averages are currently turning in a mixed performance, with the Dow down 1.74 points or less than a tenth of a percent at 13,170.40, while the Nasdaq is up 12.24 points or 0.4 percent at 3,029.22 and the S&P 500 is up 1.49 points or 0.1 percent at 1,405.42.
The choppy trading comes as traders continue to express uncertainty about the near-term outlook for the markets following the release of several key U.S. economic reports.
While the New York Federal Reserve released a report showing an unexpected contraction in regional manufacturing activity, separate reports showed a bigger than expected increase in industrial production and an unexpected improvement in homebuilder confidence.
The New York Fed said its general business conditions index dropped to a negative 5.9 in August from a positive 7.4 in July, with a negative reading indicating a contraction in regional manufacturing activity. Economists had expected the index to show a much more modest decrease to 7.0.
Meanwhile, the Federal Reserve said industrial production increased by 0.6 percent in July compared to economist estimates for an increase of about 0.5 percent. The growth reflected increased output in each of the manufacturing, mining, and utilities sectors.
A separate report released by the National Association of Home Builders showed that its index of homebuilder confidence climbed to 37 in August from 35 in July. The increase came as a surprise to economists, who had expected the index to come in unchanged compared to the previous month.
With the unexpected increase, the homebuilder confidence index rose to its highest level since coming in at 39 in February of 2007.
The Labor Department also released a report showing that consumer prices unexpectedly came in unchanged for the second consecutive month in July.
Among individual stocks, shares of Target (TGT) have moved to the upside after the discount retailer reported better than expected second quarter earnings and raised its full-year guidance. Target is currently posting a 2.4 percent gain.
Apparel retailer Abercrombie & Fitch is also turning in a strong performance after reporting second quarter earnings that fell year-over-year but came in above analyst estimates. Shares of Abercrombie & Fitch have surged up by 8.8 percent.
Meanwhile, shares of Deere (DE) have tumbled by 6.9 percent after the agricultural equipment giant reported third quarter earnings that increased by less than analysts had expected. The company also lowered its full-year revenue guidance.
Sector News
While most of the major sectors are showing only modest moves, networking stocks have shown a strong move back to the upside on the day. The NYSE Arca Networking Index has risen by 1.3 percent, partly offsetting the 2.3 percent loss it posted in the previous session.
Polycom (PLCM) and Adtran (ADTN) are turning in two of the networking sector's best performances, advancing by 4.1 percent and 2.8 percent, respectively.
Considerable strength has also emerged among health insurance stocks, as reflected by the 1.3 percent gain being posted by the Morgan Stanley Healthcare Payor Index. Centene (CNC), WellCare (WCG) and Health Net (HNT) are posting notable gains.
Trucking, semiconductor, and railroad stocks are also seeing moderate strength, while steel stocks have come under pressure on the day. The NYSE Arca Steel Index is down by 1.3 percent, moving lower for the third straight day.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Wednesday. Japan's Nikkei 225 Index edged down by 0.1 percent, while Hong Kong's Hang Seng tumbled by 1.2 percent.
The major European markets also ended the day in the red. While the French CAC 40 Index closed just below the unchanged line, the German DAX Index and U.K.'s FTSE 100 Index fell by 0.4 percent and 0.5 percent, respectively.
In the bond market, treasuries have moved to the downside, extending a recent downward trend. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, has risen by 6.2 basis points to 1.788 percent.
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