Major Averages Close Mixed Following Lackluster Session - U.S. Commentary

(RTTNews) - After ending the previous session roughly flat, stocks continued to turn in a lackluster performance during trading on Tuesday.

The major averages finished the session on opposite sides of the unchanged line. While the Dow fell 54.99 points or 0.3 percent to 21,574.73, the Nasdaq climbed 29.87 points or 0.5 percent to 6,344.31 and the S&P 500 edged up 1.47 points or 0.1 percent to 2,460.61.

The choppy trading on Wall Street came as traders expressed uncertainty about the near-term outlook for the markets after the Dow and S&P 500 reached record highs.

Traders were also digesting the latest batch of earnings news, with Bank of America (BAC), Johnson & Johnson (JNJ), and UnitedHealth (UNH) among the big-name companies releasing their quarterly results before the start of trading.

Most of the major sectors showed only modest moves on the day, contributing to the lackluster performance by the broader markets.

Airline stocks showed a significant move to the downside, however, with the NYSE Arca Airline Index falling by 1.2 percent. The drop by the index came after it ended the previous session at its best closing level in almost sixteen years.

Telecom, natural gas, and tobacco stocks also saw some weakness on the day, while considerable strength was visible among internet stocks.

On the U.S. economic front, homebuilder confidence unexpectedly declined in the month of July, according to a report released by the National Association of Home Builders.

The report said the NAHB/Wells Fargo Housing Market Index dropped to 64 in July from a revised 66 in June. Economists had expected the index to hold at the 67 originally reported for the previous month.

A separate report from the labor Department showed that import prices fell in line with economist estimates in the month of June.

The Labor Department said import prices dropped by 0.2 percent in June after edging down by a revised 0.1 percent in May.

Economists had expected import prices to fall by 0.2 percent compared to the 0.3 percent decrease originally reported for the previous month.

The report said export prices also fell by 0.2 percent in June after slumping by 0.5 percent in May. Export prices had been expected to come in unchanged.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Tuesday. Japan's Nikkei 225 Index fell by 0.6 percent, while Hong Kong's Hang Seng Index rose by 0.2 percent.

Meanwhile, the major European markets all moved to the downside on the day. While the U.K.'s FTSE 100 Index dipped by 0.2 percent, the French CAC 40 Index tumbled by 1.1 percent and the German DAX Index plunged by 1.3 percent.

In the bond market, treasuries saw notable strength, extending a recent upward trend. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 4.6 basis points to 2.263 percent.

Looking Ahead

On Wednesday, the Commerce Department is scheduled to release a report on new residential construction in the month of June.

Housing starts are expected to climb to an annual rate of 1.150 million in June after tumbling to a rate of 1.092 millions in May.

On the earnings front, IBM (IBM) CSX (CSX), and United Continental (UAL) are among the companies releasing their quarterly results after the close of today's trading.

Morgan Stanley (MS), M&T Bank (MTG) and U.S. Bancorp (USB) are due to release their results before the start of trading on Wednesday.