After moving notably higher over the two previous sessions, stocks are turning in a lackluster performance in morning trading on Wednesday. Despite the choppy trading, the tech-heavy Nasdaq has reached a new record intraday high.
Currently, the major averages are turning in a mixed performance. While the Dow is down 18.61 points or 0.1 percent at 33,926.97, the Nasdaq is up 36.82 points or 0.3 percent at 14,290.09 and the S&P 500 is up 3.71 points or 0.1 percent at 4,250.15.
Traders seem reluctant to make significant moves amid uncertainty about the near-term outlook for the markets following recent volatility.
The strong advance seen early this week came after stocks came under pressure last week, dragging the Dow down to its lowest closing level in well over two months.
The rebound has lifted the Nasdaq to a new record high, while the S&P 500 is just shy of the record intraday high set last Tuesday.
Comments from Federal Reserve Chair Jerome Powell have eased some of the concerns about the outlook for monetary policy that weighed on the markets last week.
Powell has downplayed the risk of inflation and stressed the central bank would not raise rates “preemptively,” but traders know the Fed will eventually start tapering its asset purchases.
In U.S. economic news, a report released by the Commerce Department unexpectedly showed another steep drop in new home sales in the U.S. in the month of May.
The Commerce Department said new home sales tumbled by 5.9 percent to an annual rate of 769,000 in May after plunging by 7.8 percent to a downwardly revised rate of 817,000 in April.
The continued decrease surprised economists, who had expected new home sales to climb 0.8 percent to a rate of 870,000 from the 863,000 originally reported for the previous month.
Reflecting the lackluster performance by the broader markets, most of the major sectors are showing only modest moves on the day.
Energy stocks are seeing considerable strength, however, with a sharp increase by the price of crude oil contributing to the strength in the sector. Crude for August delivery is jumping $0.95 to $73.80 a barrel.
Reflecting the strength in the energy sector, the Philadelphia Oil Service Index is up by 2.7 percent, the NYSE Arca Oil Index is up by 2 percent and the NYSE Arca Natural Gas Index is up by 1.6 percent.
Notable strength is also visible among steel stocks, as reflected by the 1.7 percent gain being posted by the NYSE Arca Steel Index.
On the other hand, utilities stocks have moved to the downside on the day, dragging the Dow Jones Utility Average down by 1.1 percent to its lowest intraday level in well over two months.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Wednesday. Japan’s Nikkei 225 Index closed just below the unchanged line while Hong Kong’s hang Seng Index jumped by 1.8 percent.
The major European markets have also turned mixed on the day. While the U.K.’s FTSE 100 Index is up by 0.2 percent, the French CAC 40 Index is down by 0.4 percent and the German DAX Index is down by 0.6 percent.
In the bond market, treasuries are nearly unchanged after ending the previous session slightly higher. 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 1.473 percent.
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