Stocks Close Mixed For Second Consecutive Session - U.S. Commentary

(RTTNews) - Stocks showed a lack of direction throughout much of the trading session on Wednesday before ending the day mixed. The choppy trading on the day extended the lackluster performance that was seen in the previous session.

While the Nasdaq climbed 29.76 points or 0.6 percent to 5,139.81, the Dow edged down 1.58 points or less than a tenth of a percent to 18,472.17 and the S&P 500 slipped 2.60 points or 0.1 percent to 2,166.58.

The advance by the tech-heavy Nasdaq came as shares of Apple (AAPL) moved sharply higher in reaction to the tech giant's quarterly results.

After the close of trading on Tuesday, Apple reported better than expected third quarter results and issued positive revenue guidance for the fourth quarter.

The mixed close by the major averages came after the Federal Reserve announced its widely expected decision to maintain the target range for the federal funds rate at 1/4 to 1/2 percent.

The Fed's statement noted that information received since its June meeting indicates that the labor market strengthened and that economic activity has been expanding at a moderate rate.

While the statement was largely unchanged from the previous meeting, the Fed did say near-term risks to the economic outlook have diminished.

The decision to leave rates unchanged was not unanimous, as Kansas City Fed President Esther George preferred to raise the target range for the federal funds rate to 1/2 to 3/4 percent.

Meanwhile, traders largely shrugged off some disappointing U.S. economic data, including a Commerce Department report showing a much bigger than expected drop in durable goods orders in the month of June.

The report said durable goods orders tumbled by 4.0 percent in June following a revised 2.8 percent decrease in May.

Economists had expected durable goods orders to dip by 1.3 percent compared to the 2.2 percent decline originally reported for the previous month.

Excluding orders for transportation equipment, durable goods orders edged down by 0.5 percent in June after slipping by 0.4 percent in May. Ex-transportation orders had been expected to rise by 0.3 percent.

A separate report from the National Association of Realtors showed a much smaller than expected increase in pending home sales in the month of June.

NAR said its pending home sales index edged up by 0.2 percent to 111.0 in June after tumbling by 3.7 percent to 110.8 in May. Economists had expected the index to jump by 1.3 percent.

A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.

Gold stocks showed a substantial move to the upside on the day, driving the NYSE Arca Gold Bugs Index up by 4.7 percent. The strength among gold stocks came as the price of gold for August delivery climbed $5.90 to $1,326.70 an ounce.

Biotechnology and steel stocks also saw considerable strength, while notable weakness was visible among electronic storage, transportation and energy stocks.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Wednesday. Japan's Nikkei 225 Index surged up by 1.7 percent, while Hong Kong's Hang Seng Index climbed by 0.4 percent.

The major European markets also moved to the upside on the day. While the French CAC 40 Index jumped by 1.2 percent, the German DAX Index advanced by 0.7 percent and the U.K.'s FTSE 100 Index rose by 0.4 percent.

In the bond market, treasuries moved notably higher in reaction to the disappointing U.S. economic data. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 4.8 basis points to 1.515 percent.