Stocks Close Modestly Lower After Pulling Back Off Early Highs - U.S. Commentary

(RTTNews) - After moving sharply higher in early trading, stocks gave back ground over the course of the trading day on Tuesday. The major averages pulled back well off their highs for the session and eventually ended the day modestly lower.

The Dow finished the day down 27.16 points or 0.2 percent at 17,613.68 after rising nearly 300 points in early trading. The tech-heavy Nasdaq also edged down 3.21 points or 0.1 percent to 4,661.50, while the S&P 500 slid 5.23 points or 0.3 percent to 2,023.03.

The pullback off the early highs was partly due to decreases in prices for crude oil and other commodities such as copper.

Crude for February delivery edged down $0.18 to $45.89 a barrel, while copper for March delivery dropped $0.0815 to $2.644 a pound.

The falling prices have led to concerns about the outlook for the global economy despite recent signs of progress in the U.S.

The worries overshadowed the optimism about earnings that were seen earlier in the day after aluminum giant Alcoa (AA) kicked off the reporting season on an upbeat note.

After the close of trading on Monday, Alcoa reported fourth quarter adjusted earnings of $0.33 per share compared to analyst estimates for $0.27 per share.

The company also reported better than expected sales and forecast a seven percent increase in global aluminum demand in 2015.

Financial giants JP Morgan (JPM), Wells Fargo (WFC), Bank of America (BAC), Citigroup (C) and Goldman Sachs (GS) are among the companies due to report their quarterly results later in the week.

Sector News

Gold stocks showed a substantial move back to the downside on the day, dragging the NYSE Arca Gold Bugs Index down by 5.1 percent. The pullback by the index came after it reached a nearly three-month intraday high in early trading.

The weakness among gold stocks came even though gold for February inched up by $1.60 on the day to $1,234.40 an ounce.

Significant weakness also emerged among electronic storage stocks, as reflected by the 2 percent loss posted by the NYSE Arca Disk Drive Index. With the loss, the index fell to a two-month closing low.

Housing, steel, and railroad stocks also saw notable weakness, while most of the other major sectors ended the day showing more modest moves.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in another mixed performance during trading on Tuesday. Japan's Nikkei 225 Index fell by 0.6 percent, while Hong Kong's Hang Seng Index advanced by 0.8 percent.

Meanwhile, the major European markets all moved to the upside on the day. While the U.K.'s FTSE 100 Index rose by 0.6 percent, the French CAC 40 Index and the German DAX Index jumped by 1.5 percent and 1.6 percent, respectively.

In the bond market, treasuries saw considerable volatility before ending the session moderately higher. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 2.2 basis points to 1.89 percent.

Looking Ahead

Following two relatively quiet days on the U.S. economic front, trading on Wednesday could be impacted by reports on retail sales, business inventories, and import and export prices.

Additionally, JP Morgan and Wells Fargo are among the companies due to release their quarterly results before the start of trading.