Stocks Close Mixed Following Lackluster Session - U.S. Commentary

(RTTNews) - After initially coming under pressure, stocks turned in a relatively lackluster performance over the course of the trading session on Friday. While the Dow remained stuck in the red throughout the day, the tech-heavy Nasdaq managed to climb into positive territory.

The major averages eventually ended the day on opposite sides of the unchanged line. The Nasdaq rose 16.89 points or 0.4 percent to 4,504.43, while the Dow slipped 21.44 points or 0.1 percent to 16,391.99 and the S&P 500 edged down just 0.05 points to 1,917.78.

Despite the mixed performance on the day, the major averages all moved notably higher for the week. While the Nasdaq surged up by 3.8 percent, the Dow and the S&P 500 jumped by 2.6 percent and 2.8 percent, respectively.

The choppy trading on Wall Street came as traders expressed some uncertainty about the outlook for the markets following the significant volatility seen over the past couple weeks.

Stocks showed a substantial move to the downside last week, with the major averages falling to their lowest closing levels in well over a year last Thursday.

While bargain hunting helped the markets to recover earlier this week, buying interest waned over the past couple sessions.

Traders also continued to keep a close eye on the price of crude oil, which pulled back further off Thursday's intraday highs.

Crude for March delivery tumbled $1.13 to $29.64 a barrel on the day amid lingering concerns about a global supply glut.

On the U.S. economic front, the Labor Department released a report before the start of trading showing consumer prices came in flat in the month of January.

The Labor Department said its consumer price index was unchanged in January after edging down by 0.1 percent in December. Economists had expected prices to dip by another 0.1 percent.

Meanwhile, the report said core consumer prices, which exclude food and energy prices, rose by 0.3 percent in January following an upwardly revised 0.2 percent increase in December.

Core prices had been expected to inch up by 0.1 percent, matching the uptick originally reported for the previous month.

Despite the lack of direction shown by the broader markets, shares of TrueCar (TRUE) fell sharply after the car-shopping website operator reported weaker than expected fourth quarter results and provided disappointing guidance.

Retailer Nordstrom (JWN) also posted a steep loss after reporting fourth quarter results that came in below analyst estimates. The company also forecast weaker than expected full-year results.

On the other hand, shares of Applied Materials (AMAT) showed a strong move to the upside after the semiconductor equipment maker reported first quarter results that beat estimates and provided upbeat guidance.

Sector News

Many of the major sectors ended the day showing only modest moves on the day, although substantial weakness was visible in the natural gas sector. Reflecting the weakness in the sector, the NYSE Arca Natural Gas Index plummeted 3.7 percent to its lowest closing level in a month.

Within the natural gas sector, Southwestern Energy (SWN) posted a particularly steep loss, with the oil and gas producer tumbling by 16.5 percent.

Gold stocks also came under pressure, dragging the NYSE Arca Gold Bugs Index down by 1.7 percent. The weakness in the gold sector came despite an increase by the price of the precious metal.

Telecom, tobacco, and computer hardware stocks also moved to the downside, while networking and biotechnology stocks saw significant strength.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Friday. Japan's Nikkei 225 Index tumbled by 1.4 percent, while Hong Kong's Hang Seng Index dropped by 0.4 percent.

The major European markets also moved to the downside on the day. While the German DAX Index slumped by 0.8 percent, the U.K.'s FTSE 100 Index and the French CAC 40 Index both fell by 0.4 percent.

In the bond market, treasuries moved modestly higher, further offsetting the recent pullback. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by 1.1 basis points to 1.748 percent.

Looking Ahead

Next week's trading may be impacted by the release of some key economic data, including reports on new and existing home sales, consumer confidence, and durable goods orders.

Earnings news from companies such as Home Depot (HD), Macy's (M), Target (TGT), Office Depot (ODP), J.C. Penney (JCP), and HP Inc. (HPQ) may also attract attention.