Midday Update: Averages Reverse Course of Record Highs as Hedge-Fund Short-Covering Ceases

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The major averages have retreated into negative territory in Thursday's midday trade after setting record highs for a sixth consecutive day as profit-taking was triggered once a leveraged option fund concluded their multi-billion dollar short-covering spree.

The S&P 500 slipped into red for the first time in eight days, coinciding with reports that Catalyst Fund had covered their $17 billion short position, and oil futures reversed early gains. As a result, the energy sector is taking the brunt of Thursday's profit-taking pressure, outpacing losses in the consumer discretionary and financial sectors.

Economic data before the opening bell did not generate much interest even though the Philadelphia Fed business outlook index soared to a 33-year high of 43.3 from 23.6 in January.

Housing data was mixed as new construction was down 2.6% to a seasonally-adjusted annual rate of 1.246 million, but permits were up 4.6% to a SAAR of 1.285 million.

Additionally, initial jobless claims increased a much less-than-expected 5,000 to 239,000 versus expectations for a gain of 12,000.

European indices saw an end to their seven-day winning streak as banking and energy shares retreated. The UK's FTSE-100 declined from a one-month high, weighed down by losses in mining and oil stocks.

Crude oil was down $10.18 to $52.93 per barrel. Natural gas was down $0.06 to $2.97 per 1 million BTU. Gold was up $8.10 to $1,241.10 an ounce, while silver was up $0.11 to $18.07 an ounce. Copper was down $0.03 to $2.74 per pound.

Among energy ETFs, the United States Oil Fund was down 0.31% to $11.33 with the United States Natural Gas Fund was down 2.10% to $7.22. Amongst precious-metal funds, the Market Vectors Gold Miners ETF was up 1.48% to 25.30 while SPDR Gold Shares were up 0.54% to $118.08. The iShares Silver Trust was up 0.59% to $17.14.

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


NYSE Composite Index was down 20.13 points (-0.17%) to 11,495.07

Dow Jones Industrial Index was down 27.85 points (-0.14%) to 20,582.62

S&P 500 was down 5.14 points (-0.22%) to 2,344.11

Nasdaq Composite Index was down 15.12 points (-0.26%) to 5,804.32


FTSE 100 was down 24.49 points (-0.34%) to 7,277.92

DAX was down 36.69 points (-0.31%) to 11,757.24

CAC 40 was down 25.40 points (-0.52%) to 4,899.46

Nikkei 225 was down 90.45 points (-0.47%) to 19,347.53

Hang Seng Index was up 112.83 points (+0.47%) to 24,107.70

Shanghai China Composite Index was up 16.63 points (+0.52%) to 3,229.62


NYSE Energy Sector Index was down 81.42 points (-0.73%) to 11,085.53

NYSE Financial Sector Index was down 14.97 points (-0.21%) to 7,335.08

NYSE Healthcare Sector Index was down 35.58 points (-0.28%) to 12,526.44


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

Copyright (C) 2016 All rights reserved. Unauthorized reproduction is strictly prohibited.

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

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