S&P 500 Finishes Choppy Trading Day At Record Closing High

Stocks showed a lack of direction throughout much of the trading session on Tuesday, extending the lackluster performance seen during last Friday’s session. The major averages moved to the upside going into end the day, however, with the S&P 500 reaching a new record closing high.

The major averages all posted modest gains on the day. The S&P 500 rose 14.95 points or 0.2 percent to 6,129.58, the Nasdaq inched up 14.49 points or 0.1 percent to 20,041.26 and the Dow crept up 10.26 points or less than a tenth of a percent to 44,556.34.

The choppy trading on Wall Street came as some traders remained on the sidelines following the Presidents’ Day holiday on Monday.

Traders may also have been expressing some uncertainty about the outlook for markets after last week’s strong gains lifted the Nasdaq and the S&P 500 back within striking distance of their record highs.

Last week’s gains came after President Donald Trump signed a memorandum calling on members of his administration to review plans for reciprocal tariffs on U.S. trade partners but stopped short of imposing the tariffs.

On the U.S. economic front, a report released by the Federal Reserve Bank of New York showed a turnaround by regional manufacturing activity in the month of February.

The New York Fed said its general business conditions index jumped to a positive 5.7 in February from a negative 12.6 in January, with a positive reading indicating growth. Economists had expected the index to climb to a negative 1.0.

Meanwhile, the report said optimism about the outlook for conditions over the next six months dropped significantly, with the index for future business activity slumping to 22.2 in February from 36.7 in January.

A separate report released by the National Association of Home Builders showed homebuilder confidence in the U.S. has unexpectedly deteriorated in the month of February.

The report said the NAHB/Wells Fargo Housing Market Index slumped to 42 in February after inching up to 47 in January. Economists had expected the index to come in unchanged.

Sector News

Computer hardware stocks showed a substantial move to the upside on the day, driving the NYSE Arca Computer Hardware Index up by 3.7 percent to a record closing high.

Significant strength was also visible among steel stocks, as reflected by the 2.0 percent jump by the NYSE Arca Steel Index. With the upward move, the index reached its best closing level in over two months.

Semiconductor stocks also moved notably higher over the course of the session, with the Philadelphia Semiconductor Index climbing by 1.7 percent to a record closing high.

Gold, airline and pharmaceutical stocks also saw considerable strength on the day, while retail stocks moved to the downside.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Tuesday. Japan’s Nikkei 225 Index rose by 0.3 percent and Hong Kong’s Hang Seng Index jumped by 1.6 percent, while China’s Shanghai Composite Index slid by 0.9 percent.

Meanwhile, European stocks moved modestly higher on the day. While the German DAX Index and the French CAC 40 Index both rose by 0.2 percent, U.K.’s FTSE 100 Index ended the day nearly unchanged.

In the bond market, treasuries gave back ground after moving sharply higher over the two previous sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, jumped 7.2 basis points to 4.544 percent.

Looking Ahead

A report on housing starts may attract attention on Wednesday along with the minutes of the latest Federal Reserve meeting, which may shed additional light on the outlook for interest rates.