Stocks Close Nearly Flat After Lackluster Session - U.S. Commentary

(RTTNews) - After recovering from initial weakness, stocks showed a lack of direction throughout much of the trading session on Monday. The major averages bounced back and forth across the unchanged line on the heels of recent strength.

Eventually, the major averages ended the session mixed. While the S&P 500 edged down by 2.55 points or 0.1 percent to 2,019.63, the Dow inched up 15.82 points or 0.1 percent to 17,229.13 and the Nasdaq crept up 1.81 points or less than a tenth of a percent to 4,750.28.

The choppy trading on Wall Street came as traders were looking ahead to the Federal Reserve's monetary policy decision scheduled to be announced Wednesday afternoon.

While the Fed is widely expected to leave interest rates unchanged, traders are likely to pay close attention to the wording of the accompanying statement.

A slew of economic data is also scheduled to be released in the coming days, including reports on retail sales, industrial production, and producer and consumer price inflation.

Profit taking contributed to the initial pullback by stocks, with traders cashing in on the gains seen over the past few weeks.

The rally seen last Friday helped the major averages to close higher for the fourth straight week, ending the day at their best closing levels in two months.

A steep drop by the price of crude oil also weighed markets, with crude for April delivery tumbling $1.32 to $37.18 a barrel.

The price of crude oil jumped $2.58 or 7.2 percent to $38.50 a barrel in the previous week, reaching its highest closing level in three months.

Sector News

While many of the major sectors showed only modest moves on the day, considerable weakness was visible among gold stocks. Reflecting the weakness in the sector, the NYSE Arca Gold Bugs Index tumbled by 3.4 percent.

The weakness in the gold sector came amid a notable decrease by the price of the precious metal, as gold for April delivery slid $14.30 to $1,245.10 an ounce.

Oil service stocks also saw significant weakness on the day amid the decrease by the price of crude oil. The Philadelphia Oil Service Index ended the day down by 2.6 percent.

Weakness was also visible among computer hardware and networking stocks, although selling pressure was relatively subdued.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region saw considerable strength during trading on Monday. Japan's Nikkei 225 Index shot up by 1.7 percent, while Hong Kong's Hang Seng Index jumped by 1.2 percent.

The major European markets also moved to the upside on the day. While the German DAX Index spiked by 1.6 percent, the U.K.'s FTSE 100 Index climbed by 0.6 percent percent and the French CAC 40 Index rose by 0.3 percent.

In the bond market, treasures are regaining some ground after trending lower in recent sessions. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 3 basis points at 1.947 percent.

Looking Ahead

Trading on Tuesday may be impacted by the release of a slew of economic data, including reports on retail sales, producer prices, and homebuilder confidence.