(RTTNews) – After failing to sustain an initial move to the upside, stocks have shown a lack of direction over the course of the trading session on Wednesday. The major averages have pulled back off their highs of the session and are now lingering near the unchanged line.
Currently, the major averages are posting modest losses. The Dow is down 46.40 points or 0.1 percent at 46,246.38, the S&P 500 is down 3.86 points or 0.1 percent at 6,653.06 and the Nasdaq is down 5.59 points or less than a tenth of a percent at 22,567.88.
The choppy trading on Wall Street may partly reflect uncertainty about the near-term outlook for the markets following yesterday’s pullback.
The major averages gave back ground after reaching record closing highs on Monday following comments from Federal Reserve Chair Jerome Powell suggesting he believes stocks may be overvalued.
Powell described equity prices as “fairly highly valued” following the recent run to record highs, contributing to yesterday’s weakness on Wall Street.
Traders may also be reluctant to make significant moves ahead of the release of some key economic data in the coming days.
Closely watched readings on consumer price inflation are likely to be in the spotlight on Friday, although reports on weekly jobless claims and durable goods orders may also attract attention on Thursday.
A report released by the Commerce Department this morning showed new home sales in the U.S. unexpectedly skyrocketed to their highest level in well over three years in the month of August.
The Commerce Department said new home sales soared by 20.5 percent to an annual rate of 800,000 in August after slumping by 1.8 percent to a revised rate of 664,000 in July.
Economists had expected new home sales to slip by 0.3 percent to an annual rate of 650,000 from the 652,000 originally reported for the previous month.
With the unexpected spike, housing starts leapt to their highest level since hitting an annual rate of 807,000 in January 2022.
Sector News
Reflecting the lackluster performance by the broader markets, most of the major sectors are showing only modest moves on the day.
Energy stocks are extending the rally seen in the previous session, however, with the NYSE Arca Oil Index jumping by 2.1 percent and the Philadelphia Oil Service Index climbing by 1.6 percent.
The strength among energy stocks comes amid a continued surge by the price of crude oil, as crude for November delivery is jumping $1.18 to $64.59 a barrel.
On the other hand, telecom stocks have moved to the downside, dragging the NYSE Arca North American Telecom Index down by 1.0 percent. Gold and networking stocks are also seeing some weakness.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Wednesday. Japan’s Nikkei 225 Index rose by 0.3 percent and Hong Kong’s Hang Seng Index jumped by 1.4 percent, while Australia’s S&P/ASX 200 Index slid by 0.9 percent.
The major European markets have also turned mixed on the day. While the French CAC 40 Index is down by 0.4 percent, the German DAX Index is up by 0.3 percent and the U.K.’s FTSE 100 Index is up by 0.4 percent.
In the bond market, treasuries have moved back to the downside following the strength seen in the previous session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 1.9 basis points at 4.137 percent.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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