Nasdaq, S&P 500 Finish Choppy Trading Day At New Record Highs

Following the mixed performance seen during Monday’s session, stocks showed a lack of direction over the course of the trading day on Tuesday. Despite the choppy trading, the Nasdaq and the S&P 500 once again reached new record closing highs.

The major averages eventually ended the day mixed. While the Dow dipped 76.47 points or 0.2 percent to 44,705.53, the Nasdaq rose 76.96 points or 0.4 percent to 19,480.91 and the S&P 500 crept up 2.73 points or 0.1 percent to 6,049.88.

A relatively light day on the U.S. economic front may have kept traders on the sidelines, although the Labor Department released a report showing job openings increased by more than expected in the month of October.

The Labor Department said job openings climbed to 7.744 million in October from a downwardly revised 7.372 million in September.

Economists had expected jobless claims to rise to 7.480 million from the 7.443 million originally reported for the previous month.

The economic calendar picks up in the coming days, with the Labor Department due to release its closely watched monthly jobs report on Friday.

Traders are also likely to keep an eye on reports on private sector employment, service sector activity and consumer sentiment as well as remarks by several Federal Reserve officials, including Fed Chair Jerome Powell.

The data and remarks could impact the outlook for interest rates ahead of the Fed’s next monetary policy meeting later this month.

CME Group’s FedWatch Tool is currently indicating a 72.1 percent chance the Fed cuts rates by another 25 basis points but a 27.9 percent chance the central bank leaves rates unchanged.

“The Fed’s December 18th decision will be a close one, but if the majority of voting members prioritize the employment mandate, markets should expect a cut in policy rates, supporting risk appetite,” said Jeffrey Roach, Chief Economist for LPL Financial.

Sector News

Reflecting the lackluster performance by the broader markets, most of the major sectors showed only modest moves on the day.

Gold stocks showed a substantial move to the upside, however, with the NYSE Arca Gold Bugs Index spiking by 3.5 percent. The rally by gold stocks came amid a modest increase by the price of the precious metal.

On the other hand, transportation stocks moved sharply lower on the day, dragging the Dow Jones Transportation Average down by 2.0 percent.

Computer hardware and biotechnology stocks also saw notable weakness, with the NYSE Arca Computer Hardware Index and the NYSE Arca Biotechnology Index both falling by 1.2 percent.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Tuesday. Japan’s Nikkei 225 Index surged by 1.9 percent, while China’s Shanghai Composite Index rose by 0.4 percent.

The major European markets also moved to the upside on the day. While the U.K.’s FTSE 100 Index advanced by 0.6 percent, the German DAX Index climbed by 0.4 percent and the French CAC 40 Index increased by 0.3 percent.

In the bond market, treasuries showed a lack of direction over the course of the session before closing modestly lower. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose 2.7 basis points to 4.223 percent.

Looking Ahead

Reports on private sector employment, factory orders and service sector activity are likely to attract attention on Wednesday along with remarks by Fed Chair Jerome Powell.

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