Stocks have shown a lack of direction over the course of the trading day on Wednesday, extending the lackluster performance seen in the previous session. The major averages have once again spent the day bouncing back and forth across the unchanged line.
Currently, the major averages are roughly flat. While the Nasdaq is up 3.96 points or less than a tenth of a percent at 16,836.58, the Dow is down 13.39 points or less than a tenth of a percent at 39,859.60 and the S&P 500 is down 1.78 points or less than a tenth of a percent at 5,319.63.
The choppy trading on Wall Street comes as traders seem reluctant to make significant moves ahead of the release of quarterly results from AI darling Nvidia (NVDA).
Nvidia is scheduled to release its fiscal first quarter results after the close of today’s trading, with analysts expecting the company to report substantial earnings and revenue growth.
Traders are also sticking to the sidelines ahead of the release of the minutes of the Federal Reserve’s latest monetary policy meeting this afternoon.
The minutes could have an impact on the outlook for interest rates following recent comments from some Fed officials suggesting rates may need to remain higher for longer than anticipated.
While the likelihood rates will be lower by September remains high, the chances have fallen to 74.4 percent from close to 90 percent last week, according to CME Group’s FedWatch Tool.
Among individual stocks, shares of Target (TGT) have moved sharply lower after the retail giant reported first quarter earnings that missed analyst estimates.
Telehealth company Hims & Hers Health (HIMS) is also seeing significant weakness after Citi downgraded its rating on the company’s stock to Neutral from Buy.
On the other hand, shares of Analog Devices (ADI) have surged after the semiconductor company reported fiscal second quarter results that beat expectations.
E-commerce company Shopify (SHOP) has also jumped after Goldman Sachs upgraded its rating on the company’s stock to Buy from Neutral.
Sector News
While most of the major sectors are showing only modest moves on the day, oil service stocks are seeing substantial weakness, dragging the Philadelphia Oil Service Index down by 2.6 percent.
The sell-off by oil service stocks comes as the price of crude oil is seeing further downside following the release of a report showing an unexpected increase by U.S. crude oil inventories last week.
A steep drop by the price of gold is also contributing to significant weakness among gold stocks, with the NYSE Arca Gold Bugs Index tumbling by 2.6 percent.
Housing stocks are also seeing considerable weakness following the release of a report unexpectedly showing a continue decrease by existing home sales.
Oil producer, natural gas and steel stocks have also moved to the downside, while notable strength is visible among biotechnology stocks.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Wednesday. Japan’s Nikkei 225 Index slid by 0.9 percent, while Hong Kong’s Hang Seng Index edged down by 0.1 percent.
The major European markets have also moved to the downside on the day. While the German DAX Index has dipped by 0.3 percent, the French CAC 40 Index is down by 0.7 percent and the U.K.’s FTSE 100 Index is down by 0.8 percent.
In the bond market, treasuries have bounced back near the unchanged line after seeing initial weakness. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by less than a basis point at 4.422 percent.
U.S. Stocks Little Changed Ahead Of Nvidia Earnings, Fed Minutes
2024-05-22 14:58:26
