U.S. Stocks Showing A Lack Of Direction Ahead Of Key Economic Data

Stocks have shown a lack of direction over the course of the trading day on Wednesday, with the major averages bouncing back and forth across the unchanged line following the notable pullback seen in the previous session.

Currently, the major averages are narrowly mixed. While the Nasdaq is down 41.05 points or 0.2 percent at 18,274.53, the S&P 500 is up 1.34 points or less than a tenth of a percent at 5,816.60 and the Dow is up 163.75 points or 0.4 percent at 42,904.17.

The choppy trading on Wall Street comes as uncertainty about the near-term outlook for the markets is keeping some traders on the sidelines on the heels of yesterday’s pullback.

The downturn on Tuesday, which was led by tech stocks after Dutch chipmaker ASML (ASML) warned of “customer cautiousness,” came after the Dow and the S&P 500 reached new record closing highs on Monday.

Traders may also be reluctant to make significant moves ahead of the release of several key economic reports on Thursday.

Reports on weekly jobless claims, retail sales and industrial production are likely to be in focus as traders look for additional clues about the outlook for the economy and interest rates.

The Labor Department released a report this morning showing a continued decrease by prices for U.S. imports in the month of September.

The report said import prices fell by 0.4 percent in September after slipping by a revised 0.2 percent in August. The decline matched economist estimates.

Compared to the same month a year ago, import prices edged down by 0.1 percent, marking the first year-over-year decrease since February.

The Labor Department also said export prices slid by 0.7 percent in September after slumping by a revised 0.9 percent in August. Economists had expected export prices to fall by 0.4 percent.

Export prices in September were down by 2.1 percent compared to the same month a year ago, reflecting the largest year-over-year decrease since January.

Among individual stocks, shares of Morgan Stanley (MS) have spiked by 7.5 percent after the financial giant reported third quarter results that exceeded analyst estimates.

J.B. Hunt Transport Services (JBHT) has also surged by 3.0 percent after reporting better than expected third quarter results.

On the other hand, shares of ASML are plunging by 5.2 percent, extending the steep drop seen on Tuesday to hit their lowest levels in ten months.

Sector News

Airline stocks are seeing substantial strength on the day, driving the NYSE Arca Airline Index up by 2.1 percent to its best intraday level in almost five months.

United Airlines (UAL) has helped lead the sector higher, soaring by 8.3 percent after reporting better than expected third quarter results and announcing a $1.5 billion share buyback.

Significant strength is also visible among banking stocks, with the KBW Bank Index jumping by 1.9 percent to a two-year intraday high.

Oil service, housing and telecom stocks are also seeing considerable strength on the day, while software stocks have shown a notable move to the downside.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Wednesday. Japan’s Nikkei 225 Index tumbled by 1.8 percent, while Australia’s S&P/ASX 200 Index declined by 0.4 percent.

Meanwhile, the major European markets are turning in a mixed performance on the day. While the French CAC 40 Index is down by 0.2 percent, the German DAX Index is up by 0.1 percent and the U.K.’s FTSE 100 Index is up by 1.1 percent.

In the bond market, treasuries are extending the upward move seen over the two previous sessions. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 2.8 basis points at 4.010 percent.

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