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Midday Update: Stocks Drift Lower as Economic Growth Slows

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The major averages continued to circle the flatline in midday trade but with a slight downside bias as disappointing Q4 growth and mixed corporate earnings weighed on Wall Street.

The Dow Jones Industrial Average remained comfortably above the 20,000 milestone with decliners and advancers nearly evenly split. The Nasdaq Composite was flat as gains in healthcare and semiconductor stocks offset losses in internet shares.

Led by a decline in business investment, economic growth slowed to an annual rate of 1.9% in the final quarter of the year, missing forecasts for a 2.2% annualized growth rate, and keeping the 2016 growth rate below 3% for the eleventh year in a row.

Stocks were also undermined by an unexpected 0.4% decline in durable goods orders which missed expectations for a gain of 2.6%. Additionally, November was revised lower to negative 4.8% from negative 4.6%. Excluding a 2.2% gain in transportation orders, durable goods orders increased 0.5%, matching analyst's estimates.

The good news was that consumer confidence continues to improve. The final University of Michigan consumer sentiment index for January was revised up to 98.5 from 98.1 initially, above the consensus estimate for a slight upward revision to 98.2.

Euro-zone bourses retreated from Thursday's 13-year highs as selling pressure on banking shares drove the Euro Stoxx index into negative territory. The UK's FTSE-100, however, settled on Friday with a modest gain but still ended the week lower as a result of the strengthening British pound.

Crude oil was down $0.55 to $53.23 per barrel. Natural gas was down $0.09 to $3.31 per 1 million BTU. Gold was down $2.80 to $1,189.80 an ounce, while silver was up $0.28 to $17.14 an ounce. Copper was up $0.02 to $2.69 per pound.

Among energy ETFs, the United States Oil Fund was down 1.43% to $11.37 with the United States Natural Gas Fund was down 2.13% to $8.29. Amongst precious-metal funds, the Market Vectors Gold Miners ETF was up 0.83% to 23.06 while SPDR Gold Shares were down 0.13% to $113.11. The iShares Silver Trust was up 1.82% to $16.22.

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

US MARKETS

NYSE Composite Index was down 33.89 points (-0.30%) to 11,279.44

Dow Jones Industrial Index was up 0.51 points (+0.00%) to 20,101.77

S&P 500 was down 3.17 points (-0.14%) to 2,293.51

Nasdaq Composite Index was down 1.01 points (-0.02%) to 5,654.28

GLOBAL SENTIMENT

FTSE 100 was up 21.95 points (+0.31%) to 7,183.44

DAX was down 44.00 points (+0.37%) to 11,804.63

CAC 40 was down 27.26 points (-0.56%) to 4,839.98

Nikkei 225 was up 65.01 points (+0.34%) to 19,467.40

Hang Seng Index was down 13.39 points (-0.06%) to 23,360.78

Shanghai China Composite Index was up 9.61 points (+0.31%) to 3,159.17

NYSE SECTOR INDICES

NYSE Energy Sector Index was down 93.82 points (-0.82%) to 11,409.37

NYSE Financial Sector Index was down 38.88 points (-0.55%) to 7,138.28

NYSE Healthcare Sector Index was up 84.19 points (+0.71%) to 11,938.50

UPSIDE MOVERS

(+) SGM (+30.08%) Acquired by Home Point Financial for $211 million

(+) WYNN (+8.35%) Q4 revenue jumps 37% from year ago, beats Wall Street estimates

(+) MSFT (+2.38%) Sets all-time high after beating Q2 quarterly estimates

DOWNSIDE MOVERS

(-) NOVN (-77.81%) Reported mixed results of two replicate phase 3 clinical trials for SB204

(-) ATHX (-29.61%) Priced public offering of 19 million shares at $1.01

(-) EEP (-15.68%) Predicts a decline in distributive cash flow to $750 million-$800 million from $860 million-$920 million

(-) WKHS (-13.54%) Announced underwritten public stock offering

(-) RAD (-4.20%) Deadline for Walgreen's ( WBA ) merger expires without extension

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 MTNewswires.com. 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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