U.S. Stocks Showing A Lack Of Direction In Mid-Day Trading
After failing to sustain an initial move to the upside, stocks have shown a lack of direction over the course of the trading day on Tuesday. The major averages pulled back off their highs and have recently been bouncing back and forth across the unchanged line.
The Dow jumped by more than 180 points in early trading but is currently up just 3.59 points or less than a tenth of a percent at 30,407.56. The S&P 500 is up 4.82 points or 0.1 percent at 3,740.18, while the Nasdaq is down 22.64 points or 0.2 percent at 12,876.79.
Stocks initially benefited from window dressing, as some fund managers looked to further boost their portfolios going into the end of the year.
The initial advance lifted the major averages to new record intraday highs, although buying interest waned shortly after the start of trading.
Traders subsequently looked to cash in on the recent strength in the markets, leading to the pullback by the major averages.
The choppy trading seen since then reflects light volume, as many traders remain away from their desks ahead of the New Year’s Day holiday on Friday.
A lack of major U.S. economic data has also kept some traders on the sidelines ahead of the release of reports on pending home sales and weekly jobless claims in the coming days.
Reflecting the lackluster performance by the broader markets, most of the major sectors are showing only modest moves in mid-day trading.
Networking stocks have shown a significant move to the downside, however, with the NYSE Arca Networking falling by 1.6 percent. The index turned lower after reaching its best intraday level in almost twenty years.
Considerable weakness is also visible among biotechnology stocks, as reflected by the 1.3 percent drop by the NYSE Arca Biotechnology Index.
Within the biotech sector, shares of Arcturus Therapeutics (ARCT) have moved sharply lower as analysts were disappointing by the results of a Phase 1/2 trial of its COVID-19 vaccine candidate.
Oil service and tobacco stocks are also seeing notable weakness in mid-day trading, while steel and gold stocks have shown strong moves to the upside.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Tuesday. Japan’s Nikkei 225 Index surged up by 2.7 percent, while Hong Kong’s Hang Seng Index jumped by 1 percent.
Meanwhile, the major European markets turned mixed over the course of the session. While the German DAX Index dipped by 0.2 percent, the French CAC 40 Index rose by 0.4 percent and the U.K.’s FTSE 100 Index shot up by 1.6 percent following the long weekend.
In the bond market, treasuries have bounced back near the unchanged line after seeing initial weakness. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by less than a basis point at 0.941 percent.
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