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U.S. Stocks May Continue To Experience Choppy Trading

wallstreet4 061518 06nov19 lt

Following the lackluster performance seen in the previous session, stocks may continue to experience choppy trading early on Wednesday. The major index futures are currently pointing to a slightly higher open for the markets, with the Dow futures up by 28 points.

Traders may remain reluctant to make significant moves amid some uncertainty about the near-term outlook for the markets after the recent run to record highs.

Optimism about a potential U.S.-China trade deal contributed to the strength on Wall Street, but traders now seem to be looking for more concrete developments.

U.S. and Chinese officials have continued to tout progress in the ongoing trade talks, building anticipation for phase one of an agreement to be signed sometime this month.

However, traders may start to get antsy the longer negotiations drag on without an announcement of new plans for a meeting between President Donald Trump and Chinese President Xi Jinping.

On the U.S. economic front, preliminary data released by the Labor Department showed labor productivity in the U.S. unexpectedly edged lower in the third quarter.

The report said labor productivity dipped by 0.3 percent in the third quarter after spiking by an upwardly revised 2.5 percent in the second quarter.

The drop came as a surprise to economists, who had expected productivity to climb by 0.9 percent compared to the 2.3 percent jump originally reported for the previous month.

Meanwhile, the Labor Department said unit labor costs soared by 3.6 percent in the third quarter after surging up by a downwardly revised 2.4 percent in the second quarter.

Economists had expected unit labor costs to jump by 2.2 percent compared to the 2.6 percent spike originally reported for the previous month.

After failing to sustain an early move to the upside, stocks showed a lack of direction over the course of trading session on Tuesday. The major averages spent the day bouncing back and forth across the unchanged line, although the Dow and the Nasdaq still crept up to new record closing highs.

The major averages finished the day on opposite sides of the unchanged line. While the S&P 500 edged down 3.65 points or 0.1 percent at 3,074.62, the Dow ticked up 30.52 points or 0.1 percent to 27,492.63 and the Nasdaq inched up 1.48 points or less than a tenth of a percent to 8,434.68.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Wednesday. Japan's Nikkei 225 Index rose by 0.2 percent, while China's Shanghai Composite Index fell by 0.4 percent.

Meanwhile, the major European markets have all moved modestly higher on the day. While the U.K.'s FTSE 100 Index has crept up by 0.1 percent, the German DAX Index and the French CAC 40 Index are up by 0.3 percent and 0.4 percent, respectively.

In commodities trading, crude oil futures are slipping $0.30 to $56.93 a barrel after climbing $0.69 to $57.23 a barrel on Tuesday. Meanwhile, an ounce of gold is trading at $1,490, up $6.30 compared to the previous session's close of $1,483.70. On Tuesday, gold plunged $27.40.

On the currency front, the U.S. dollar is trading at 108.97 yen compared to the 109.16 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $1.1087 compared to yesterday's $1.1075.

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