Stocks Continue To Show A Lack Of Direction - U.S. Commentary

(RTTNews) - After initially showing a lack of direction, stocks continue to turn in a lackluster performance in mid-day trading on Friday. The major averages have spent much of the day lingering near the unchanged line.

Currently, the major averages are posting modest losses on the day. The Dow is down 16.03 points or 0.1 percent at 20,918.52, the Nasdaq is down 4.43 points or 0.1 percent at 5,896.33 and the S&P 500 is down 1.78 points or 0.1 percent at 2,379.60.

The choppy trading on Wall Street comes as traders are taking a breather as they continue to digest Wednesday's closely watched monetary announcement from the Federal Reserve.

The Fed announced a widely anticipated quarter point increase in interest rates and projected two additional rate hikes this year.

A meeting of G20 finance ministers and central bank governors being held in Germany over the next two days may also be keeping some traders on the sidelines.

Given the protectionist views of the Trump administration, it remains to be seen whether the final statement from the meeting will contain a pledge to resist all forms of protectionism.

Traders have largely shrugged off the latest batch of U.S. economic data, including a report from the Fed showing that industrial production was unexpectedly flat in February.

The Fed said industrial production was unchanged in February after edging down by a revised 0.1 percent in January. Economists had expected production to rise by 0.2 percent.

A jump in mining output and a continued increase in manufacturing output were offset by another slump in utilities output amid unseasonably warm weather.

The University of Michigan released a separate report showing a bigger than expected rebound in consumer sentiment in March.

The preliminary report showed that the consumer sentiment index rose to 97.6 in March after dropping to 96.3 in February. Economists had expected the index to rise to 97.0.

Sector News

Most of the major sectors are showing only modest moves on the day, contributing to the lackluster performance by the broader markets.

Financial stocks are seeing notable weakness, however, with the NYSE Arca Broker/Dealer Index and the Dow Jones Banks Index sliding by 1.2 percent, and 1.1 percent, respectively.

Biotechnology stocks are also extending the pullback seen in the previous session, while some strength is visible among tobacco and utilities stocks.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Friday. Japan's Nikkei 225 Index fell by 0.4 percent, while Hong Kong's Hang Seng Index inched up by 0.1 percent.

Meanwhile, the major European markets are roughly flat on the day. While the French CAC 40 Index is up by 0.1 percent, the U.K.'s FTSE 100 Index and the German DAX Index are both nearly unchanged.

In the bond market, treasuries have moved back to the upside following the modest pullback seen on Thursday. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 2.7 basis points at 2.495 percent.