Mixed Data Leads To Lackluster Performance On Wall Street - U.S. Commentary

(RTTNews) - With traders digesting a mixed batch of U.S. economic data, stocks turned in a relatively lackluster performance during trading on Thursday. The major averages eventually ended the day mixed after posting strong gains in the two previous sessions.

The Dow ended the day firmly in the red, sliding 64.93 points or 0.4 percent to 16,417.01. Meanwhile, the broader Nasdaq and S&P 500 closed roughly flat. While the Nasdaq inched up 3.81 points or 0.1 percent to 4,218.69, the S&P 500 edged down 2.49 points or 0.1 percent to 1,845.89.

The lack of direction seen for much of the session came as traders digested a slew of economic data, including separate reports showing stronger than expected regional manufacturing growth but an unexpected pullback in homebuilder confidence.

The Philadelphia Federal Reserve released a report showing that its index of regional manufacturing activity rose to 9.4 in January from a revised 6.4 in December, with a positive reading indicating growth. Economists had expected the index to climb to 8.7.

While the index rose more than expected, Amna Asaf, an economist at Capital Economics, said the details of the survey suggest that manufacturing activity is a little bit softer than indicated by the headline index.

Meanwhile, the National Association of Home Builders said its index of homebuilder confidence edged down to 56 in January from a downwardly revised 57 in December.

Economists had expected the index to come in unchanged compared to the 58 originally reported for the previous month.

The Labor Department also released a pair of reports showing a modest drop in weekly jobless claims and an increase in consumer prices that matched economist estimates.

Among individual stocks, shares of Best Buy (BBY) plummeted by 28.6 percent after the consumer electronics retailer reported a drop in holiday sales.

Financial giant Citigroup (C) also came under pressure on the day after reporting weaker than expected fourth quarter earnings.

Meanwhile, shares of Alcoa (AA) moved notably higher after the aluminum giant announced it will permanently close the remaining two potlines at its Massena East smelter in New York in the first quarter.

Sector News

Most of the major sectors ended the day showing only modest moves, contributing to the lackluster close by the broader markets.

Railroad stocks saw substantial weakness, however, with the Dow Jones Railroads Index plunging by 2.8 percent. The steep drop by the index came after it ended the previous session at a record closing high.

CSX Corp. (CSX) helped lead the railroad sector lower, tumbling by 6.8 percent after reporting weaker than expected fourth quarter earnings.

Banking, networking, and retail stocks also saw some weakness on the day, while strength was visible among biotechnology, natural gas, and gold stocks.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Thursday. Japan's Nikkei 225 Index fell by 0.4 percent, while Hong Kong's Hang Seng Index ended the day up by 0.4 percent.

Meanwhile, the major European markets all finished the day on the downside. While the U.K.'s FTSE 100 Index edged down by 0.1 percent, the German DAX Index and the French CAC 40 Index dipped by 0.2 percent and 0.3 percent, respectively.

In the bond market, treasuries moved back to the upside after closing lower in the two previous sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 4.1 basis points to 2.843 percent.

Looking Ahead

Another batch of U.S. economic data is scheduled to be released on Friday, with traders likely to keep an eye on reports on housing starts, industrial production, and consumer sentiment.

Trading could also be impacted by reaction to earnings news from Intel (INTC), which is reporting its fourth quarter results after the close of today's trading.