Midday Update: Sanctions Upset Upward Momentum; Stocks Giving Up Most of Consumer Confidence Gains

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Stocks retreated from their early gains, turning mixed in mid-day trade after European Union officials this morning agreed to new sanctions on Russia's oil and defense industries. Although stocks were building on Monday's modest gains following upbeat earnings for several pharmaceutical firms and consumer confidence rising to a 78-month high, equities reversed course following the breaking news from Brussels, rekindling a flight out of risky assets and into the safety of U.S. government bonds and precious metals.

Better-than-expected earnings from drug-makers Merck ( MRK ) and Pfizer ( PFE ) along with cigarette-maker Reynolds American ( RAI ) contributed to the higher open with gains accelerating following the release of July consumer confidence figures. The index shot up to a 90.9 final reading, beating estimates of 85.5 and hitting its highest level in more than six years. The data helped offset an unexpected 0.3% decline in the Case-Shiller home price index, trailing expectations for a 0.4% rise, and market nervousness with the start of the Federal Open Markets Committee meeting today.

But the news of new Russia sanctions underscored global markets' vulnerability to economic shocks, as well as political fall-out from an isolated Russia. European equities gave back some of their earlier gains, but still closed on the plus side, ending a two-day losing streak in the UK FTSE-100. Sovereign EU debt continues to appreciate, however, as a safe-haven to geo-political turmoil, driving the yield on the German bund to only 1.15%.


Crude oil was down $0.95 to $100.72 per barrel. Natural gas was unchanged at $3.76 per 1 million BTU. Gold was down $5.10 to $1,300.80 an ounce, while silver was up $0.03 to $20.60 an ounce. Copper was down $0.03 to $3.22 per pound.

Among energy ETFs, the United States Oil Fund was down 0.85% to $37.32 with the United States Natural Gas Fund was up $0.05 to $20.73. Amongst precious-metal funds, the Market Vectors Gold Miners ETF was down 0.37% to 26.83 while SPDR Gold Shares were down 0.57% to $125.01. The iShares Silver Trust was down 0.30% to $19.75.

Here's where the U.S. markets stand at mid-day:

NYSE Composite Index down 8.43 (-0.08%) to 10,978.80

Dow Jones Industrial Average up 24.02 (+0.14%) to 17,006.61

S&P 500 up 0.95 (+0.05%) to 1,979.86

Nasdaq Composite Index up 12.28 (+0.28%) to 4,457.19

GLOBAL SENTIMENT

Nikkei 225 Index up 0.57%

Hang Seng Index up 0.87%

Shanghai China Composite Index up 0.24%

FTSE 100 Index up 0.29%

CAC 40 up 0.48%

DAX up 0.58%

NYSE SECTOR INDICES

NYSE Energy Sector Index down 1.24%

NYSE Financial Sector Index down 0.15%

NYSE Healthcare Sector Index up 0.12%

UPSIDE MOVERS

(+) AMAG (+11.37%) Q2 loss narrower than street estimates, beats on revenue, sees FY 14 rev in line.

(+) SNCR (+14.83%) Q2 results top expectations, positive trends seen continuing.

(+) CAMT (+18.95%) Q2 earnings beat views.

(+) FTR (+11.78%) FCC clears purchase of AT&T ( T ) customer assets.

(+) CGNX (+17.33%) Sets Q3 revenue guidance above street.

DOWNSIDE MOVERS

(-) CARB (-4.25%) Posts narrower Q2 loss vs street, beats on revenue but issues mixed Q3 FY14 outlook.

(-) GTI (-14.35%) Swings to a loss and lowers FY 2014 estimates.

(-) GALT (-55.37%) Plans call on phase 1 fatty liver disease data.

(-) LOCO (-11.38%) Drops after post-IPO surge.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

Copyright (C) 2014 MTNewswires.com. All rights reserved. Unauthorized reproduction is strictly prohibited.



This article appears in: Investing , Commodities

Referenced Stocks: MRK , PFE , RAI , T

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