Stocks Remain Mostly Negative In Mid-Day Trading - U.S. Commentary

(RTTNews) - After coming under pressure early in the session, stocks have remained mostly negative over the course of the trading day on Thursday. The tech-heavy Nasdaq staged a recovery and briefly peeked above the unchanged line but has pulled back since then.

Currently, the major averages are seeing moderate weakness on the day. The Dow is down 68.90 points or 0.4 percent at 17,433.69, the Nasdaq is down 15.38 points or 0.3 percent at 4,753.48 and the S&P 500 is down 10.29 points or 0.5 percent at 2,026.42.

Profit taking is contributing to the weakness on Wall Street, with traders cashing in on recent strength ahead of the long weekend.

Despite the weakness seen on Wednesday, the major averages remained relatively high after reaching their best closing levels in well over two months earlier this week.

Concerns about the outlook for interest rates may also be weighing on the markets following comments from St. Louis Federal Reserve President James Bullard.

Bullard said the relatively minor downgrades to the Fed's economic outlook suggest the next rate hike "may not be far off provided that the economy evolves as expected."

Additional selling pressure has been generated by a decrease by the price of crude oil, which is seeing further downside after yesterday's steep drop.

After tumbling $1.66 to $39.79 a barrel in the previous session, crude oil for May delivery is sliding $0.94 to $38.85 a barrel.

On the U.S. economic front, the Labor Department released a report before the start of trading showing a modest increase in initial jobless claims in the week ended March 19th.

The Labor Department said initial jobless claims edged up to 265,000, an increase of 6,000 from the previous week's downwardly revised level of 259,000.

Economists had expected jobless claims to inch up to 268,000 from the 265,000 originally reported for the previous week.

A separate report from the Commerce Department showed a pullback in durable goods orders in the month of February.

The Commerce Department said durable goods orders fell by 2.8 percent in February after surging up by a revised 4.2 percent in January. Economists had expected durable goods orders to drop by 3.0 percent.

Excluding orders for transportation equipment, durable goods orders slid by 1.0 percent in February after climbing by 1.2 percent in January. Ex-transportation orders had been expected to dip by 0.2 percent.

Sector News

While many of the major sectors are showing only modest moves, airline stocks have shown a significant move to the downside. Reflecting the weakness in the sector, the NYSE Arca Airline Index has fallen by 1.9 percent.

Industry giants United Continental (UAL) and American Airlines (AAL) are turning in two of the airline sector's worst performances on the day.

Considerable weakness is also visible among electronic storage stocks, as reflected by the 1.7 percent drop by the NYSE Arca Disk Drive Index. Seagate Technology (STX) has helped to lead the sector lower, tumbling by 6.5 percent.

Financial stocks have also come under pressure on the day, dragging the NYSE Arca Broker/Dealer Index and the Dow Jones Banks Index down by 1.7 percent and 1.4 percent, respectively.

On the other hand, gold stocks have shown a strong move to the upside, driving the NYSE Arca Gold Bugs Index up by 2.2 percent. The strength in the sector comes in spite of a continued decrease by the price of gold.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Thursday. Japan's Nikkei 225 Index fell by 0.6 percent, while Hong Kong's Hang Seng Index slumped by 1.3 percent.

The major European markets have also come under pressure on the day. While the French CAC 40 Index has tumbled by 2 percent, the German DAX Index and the U.K.'s FTSE 100 Index are down by 1.5 percent and 1.4 percent, respectively.

In the bond market, treasuries have turned lower over the course of the trading session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 2 basis points at 1.895 percent.