After moving sharply higher over the past several sessions, stocks turned in a lackluster performance during trading on Tuesday. Despite the choppy trading, the tech-heavy Nasdaq inched up to a new record closing high.
The major averages ended the day on opposite sides of the unchanged line. While the Nasdaq crept up 20.06 points or 0.1 percent to 14,007.70, the Dow edged down 9.93 points or less than a tenth of a percent to 31,375.83 and the S&P 500 slipped 4.36 points or 0.1 percent to 3,911.23.
Traders seemed to be taking a breather following the advance seen in recent days, which drove all of the major averages to new record closing highs on Monday.
The Dow and the S&P 500 had both closed higher for six consecutive sessions, while the Nasdaq rose in five out of the six previous sessions.
Profit taking contributed to some initial weakness on Wall Street, although selling pressure was relatively subdued as traders worry about missing out on further upside.
Optimism about more fiscal stimulus also helped support the markets along with the recent slowdown in coronavirus infection rates.
House Democrats have unveiled a proposal providing $1,400 stimulus checks to individuals making up to $75,000 a year and couples who earn up to $150,000 a year.
Those income levels are unchanged from previous stimulus checks, although the proposal would phase out payments faster than previous bills and completely cut off individuals making more than $100,000 and couples making more than $200,000.
Among individual stocks, shares of Glu Mobile (GLUU) moved sharply higher after the mobile game developer agreed to be acquired by Electronic Arts (EA) for $12.50 per share in cash.
Apparel maker HanesBrands (HBI) also saw substantial strength after reporting fourth quarter results that exceeded analyst estimates on both the top and bottom lines.
On the other hand, shares of Coty (COTY) came under pressure after the cosmetics company reported fiscal second quarter adjusted earnings that beat estimates but its revenues came in slightly below expectations.
Sector News
Most of the major sectors ended the day showing only modest moves, contributing to the lackluster close by the broader markets.
Energy stocks saw considerable weakness, however, with traders cashing in on recent gains even as the price of crude oil once again rose to its highest closing level in over a year.
Reflecting the weakness in the energy sector, the Philadelphia Oil Service Index slumped by 1.9 percent and the NYSE Arca Oil Index slid by 1.4 percent.
Profit taking also contributed to weakness among airline stocks, with the NYSE Arca Airline Index falling by 1.6 percent after ending the previous session at a nearly one-year closing high.
Housing and chemical stocks also moved to the downside on the day, while tobacco and networking stocks extended their upward trends.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Tuesday. Japan’s Nikkei 225 Index rose by 0.4 percent, while Australia’s S&P/ASX 200 Index slid by 0.9 percent.
The major European markets also finished the day on opposite sides of the unchanged line. While the German DAX Index fell by 0.3 percent, the U.K.’s FTSE 100 Index and the French CAC 40 Index both inched up by 0.1 percent.
In the bond market, treasuries pulled back near the unchanged line after seeing early strength. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by less than a basis point to 1.157 percent.
Looking Ahead
The latest earnings news may help drive trading on Wednesday, with Cisco (CSCO), Lyft (LYFT), Mattel (MAT), and Twitter (TWTR) among the companies releasing their quarterly results after the close of today’s trading.
Coca-Cola (KO), General Motors (GM) and Under Armour (UAA) are also among the companies due to report their results before the start of trading on Wednesday.
Traders are also likely to keep an eye on a report on consumer price inflation as well as remarks by Federal Reserve Chair Jerome Powell.
Business News
U.S. Stocks Close Little Changed Following Recent Strength
2021-02-09 21:16:10
