Stocks traded with a lack of direction throughout the entire session on Tuesday, unable to sustain any notable moves in either direction. An increase in oil prices offset positive sentiment from better than expected numbers on consumer confidence.
A rise in oil prices weighed on the markets throughout the session, as traders expressed concern that Hurricane Gustav could cause problems for the Gulf of Mexico's oil region. Light sweet crude for October delivery closed at $116.27 a barrel, up $1.16 for the session.
Gustav, currently a category 1 hurricane that has sustained winds around 90 miles per hour, reached landfall in Haiti on Tuesday afternoon. The storm is expected to pick up steam again as it heads towards Cuba on Wednesday. Gustav is predicted to reach the Gulf of Mexico over Labor Day weekend, leading to concerns that oil supplies from the region could be disrupted.
Nonetheless, some investors were prompted to buy stocks after the Conference Board released its consumer confidence index, which showed that confidence increased by much more than anticipated in the month of August. The improvement reflected a notable increase in confidence in the outlook for the next six months.
Despite the bigger than expected increase, however, Lynn Franco, Director of the Conference Board Consumer Research Center noted, "Overall readings are still quite low by historical standards and it is still too early to tell if the worst is behind us."
At the same time, the Commerce Department released its report on new home sales in the month of July, showing that sales of new homes unexpectedly increased compared to a downwardly revised reading for the previous month.
Meanwhile, concerns about adverse financial sector developments combined with expectations of a moderation in inflation contributed to the Federal Reserve's latest decision to leave interest rates unchanged, according to the minutes of the August meeting released on Tuesday.
The minutes showed that the members of the Federal Open Market Committee agreed that further softening in the labor markets and continued stress on the financial markets, combined with elevated energy prices and the housing contraction, would likely weigh on economic growth.
While most members did not see the current stance of policy as particularly accommodative in light of elevated borrowing costs and reduced credit availability, they generally agreed that the next policy move would likely be a tightening.
Nonetheless, Michelle Meyer and Zach Pandl of Lehman Brothers said, "Overall, we judge the FOMC minutes to be consistent with the Fed remaining on hold this year."
In other news, Thornburg Mortgage (TMA) closed sharply higher after the company reported second quarter results before the opening bell on Monday. Further, Thornburg commenced its exchange offer and consent solicitation for all of its outstanding preferred stock. Preferred shareholders will receive $5.00 in cash and 3.5 shares of the company's common stock for each share of preferred stock validly tendered and accepted. The stock ended the day up 22.5 percent.
On the other hand, Darden Restaurants (DRI) provided first-quarter earnings guidance before the opening bell that came in well below analysts' consensus estimate. The casual dining restaurant operator further slashed its fiscal 2009 earnings outlook and said it believes that same-store sales will remain under pressure for the rest of the year. The stock closed down 12.4 percent on the news.
The major averages ended the session in a mixed fashion, with the Nasdaq closing in negative territory. While the Nasdaq closed down 3.62 points or 0.2 percent at 2,361.97, the Dow closed up 26.62 points or 0.2 percent at 11,412.87 and the S&P 500 closed up 4.67 points or 0.4 percent at 1,271.51.
For comments and feedback contact: editorial@rttnews.com
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.