Stocks Close Firmly In Negative Territory - U.S. Commentary

(RTTNews) - After ending the previous session moderately higher, stocks moved back to the downside during trading on Tuesday. Selling pressure remained relatively subdued, however, limiting the downside for the markets.

The major average ended the day firmly in the red. The Dow fell 8.16 points or 0.4 percent to 2,143.15, the Nasdaq slid 26.43 points or 0.5 percent to 5,283.40 and the S&P 500 dropped 53.76 points or 0.3 percent to 18,169.27.

The weakness on Wall Street came as traders reacted to the latest batch of earnings news, with a number of big-name companies releasing their quarterly results.

Shares of Sonic (SONC) fell sharply on the day after the fast food chain reported better than expected fiscal fourth quarter earnings but provided disappointing guidance.

Sportswear maker Under Amour (UA) also came under pressure after the company said its growth rate going forward will be less than expected.

On the other hand, shares of Procter & Gamble (PG) showed a strong move to the upside after the consumer products giant reported fiscal first quarter results that exceeded analyst estimates.

3M (MMM), Caterpillar (CAT), and DuPont (DD) are among the other well known companies that released their quarterly results on the day, while tech giant Apple (AAPL) is due to release its results after the close.

In economic news, the Conference Board released a report showing a bigger than expected drop in consumer confidence in the month of October.

The Conference Board said its consumer confidence index fell to 98.6 in October after climbing to 103.5 in September. Economists had expected the index to drop to 101.0.

"Consumers' assessment of current business and employment conditions softened, while optimism regarding the short-term outlook retreated somewhat," said Lynn Franco, Director of Economic Indicators at the Conference Board.

She added, "Overall, sentiment is that the economy will continue to expand in the near-term, but at a moderate pace."

Sector News

Housing stocks showed a significant move to the downside on the day, dragging the Philadelphia Housing Sector Index down by 2.3 percent. With the drop, the index fell to its lowest closing level in nearly four months.

Masco (MAS) led the housing sector lower, with the cabinetry manufacturer slumping by 9.5 percent after reporting weaker than expected third quarter results.

Considerable weakness was also visible among natural gas stocks, as reflected by the 1.9 percent drop by the NYSE Arca Natural Gas Index. Biotechnology, consumer, and oil service stocks also saw notable weakness.

Meanwhile, gold stocks moved sharply higher as the day has progressed, driving the NYSE Arca Gold Bugs Index up by 2.5 percent. The strength among gold stocks came as gold for December delivery climbed $9.90 to $1,273.60 an ounce.

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 advanced by 0.8 percent, while Hong Kong's Hang Seng Index edged down by 0.2 percent.

The major European markets also ended the day mixed. While the U.K.'s FTSE 100 Index rose by 0.5 percent, the German DAX Index closed just below the unchanged line and the French CAC 40 Index fell by 0.3 percent.

In the bond market, treasuries showed a lack of direction over the course of the session before closing roughly flat. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, dipped by less than a basis point to 1.758 percent.

Looking Ahead

Trading on Wednesday may be impacted by reaction to a report on new home sales as well as the latest batch of earnings news.