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U.S. Stocks Turning In Mixed Performance After Yesterday's Rally

wallstreet aug29 25nov20 lt

Stocks are turning in a mixed performance during trading on Wednesday following the rally seen in the previous session. While the tech-heavy Nasdaq has edged higher, the Dow and the S&P 500 are giving back ground.

Currently, the major averages remain on opposite sides of the unchanged line. The Nasdaq is up 25.33 points or 0.2 percent at 12,062.11, but the Dow is down 128.14 points or 0.4 percent at 29,918.10 and the S&P 500 is down 9.31 points or 0.3 percent at 3,626.10.

The mixed performance on Wall Street comes as traders seem reluctant to make more significant moves amid uncertainty about the near-term outlook for the markets after the Dow and the S&P 500 reached new record closing highs on Tuesday.

Some traders have looked to cash in on yesterday's gains, although recent upbeat coronavirus vaccine news has kept selling pressure relatively subdued.

Traders are also digesting a slew of U.S. economic data, with a report from the Labor Department showing fist-time claims for U.S. unemployment benefits unexpectedly increased in the week ended November 21st.

The report said initial jobless claims climbed to 778,000, an increase of 30,000 from the previous week's revised level of 748,000.

The increase surprised economists, who had expected jobless claims to drop to 730,000 from the 742,000 originally reported for the previous week.

Meanwhile, new orders for U.S. manufactured durable goods increased by more than expected in the month of October, the Commerce Department revealed in a report.

The Commerce Department said durable goods orders jumped by 1.3 percent in October after spiking by 2.1 percent in September. Economists had expected durable goods orders to climb by 0.9 percent.

Excluding an increase in orders for transportation equipment, durable goods orders still surged up by 1.3 percent in October after jumping by 1.5 percent in September. Ex-transportation orders were expected to rise by 0.4 percent.

A separate report released by the Commerce Department showed the spike in gross domestic product in the third quarter was unrevised from the initial estimate.

The Commerce Department said GDP skyrocketed by an annual rate of 33.1 percent in the third quarter after plunging by 31.4 percent in the second quarter. The unrevised reading on GDP matched economist estimates.

Another report from the Commerce Department showed new home sales in the U.S. unexpectedly edged lower in the month of October.

The Commerce Department said new home sales dipped by 0.3 percent to an annual rate of 999,000 in October after inching up by 0.1 percent to a revised rate of 1.002 million in September.

Economists had expected new home sales to jump by 1.1 percent to a rate of 970,000 from the 959,000 originally reported for the previous month.

The Commerce Department also released a report showing a decrease in U.S. personal income in the month of October.

The report said personal income fell by 0.7 percent in October after climbing by a downwardly revised 0.7 percent in September.

Economists had expected personal income to come in unchanged compared to the 0.9 percent increase originally reported for the previous month.

Banking stocks have shown a significant move to the downside on the day, dragging the KBW Bank Index down by 1.9 percent. The index ended the previous session at its best closing level in nearly nine months.

Considerable weakness is also visible among tobacco stocks, as reflected by the 1.5 percent drop by the NYSE Arca Tobacco Index.

Computer hardware, oil service and chemical stocks are also seeing notable weakness, while gold stocks have moved sharply higher.

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 0.5 percent, while China's Shanghai Composite Index tumbled by 1.2 percent.

The major European markets have also turned mixed on the day. While the French CAC 40 Index has inched up by 0.1 percent, the German DAX Index is down by 0.1 percent and the U.K.'s FTSE 100 Index is down by 0.8 percent.

In the bond market, treasuries have moved higher as traders digest the slew of U.S. economic data. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 1.5 basis points at 0.867 percent.

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