Midday Update: Stocks Make New Lows As Fed-Led Rally Dissolves

Stocks continue to trade below yesterday's Fed-fueled highs, while energy shares are back in the red, leaving the Dow Jones Industrials and S&P 500 more than 0.50% lower. After soaring late Wednesday in the aftermath of the dovish Federal Reserve Open Market Committee statement, Wall Street is taking profits and retreating off yesterday's nosebleed levels. The Nasdaq, however, is holding onto a slim gain thanks to strength in biotechs and chipmakers.

Yesterday's meteoric rise was extinguished right before the close after the Nasdaq touched 5,000, triggering light profit-taking which spilled into pre-market trading . By the open, stocks were well into negative territory, trading defensively in respect of a stronger dollar and weaker oil stocks.

Today's lackluster economic data only added to the defensive tone. New jobless claims for the week ended March 14 increased 1,000 to 291,000, missing estimates for a 4,000 gain. The week prior was revised upward by 1,000 to 290,000.

The current account deficit swelled to $113.5 billion from a downward revised deficit of $98.9 billion.

The Philadelphia Fed Business Outlook index dropped to 5.0 in March from an unrevised 5.2 the month prior. This was, however, below estimates for an increase to 7.0.

Finally, leading economic indicators were up 0.2% last month, missing expectations for a gain of 0.3%. January LEI was an unrevised +0.2%.

European markets followed Wall Street lower, weighed down by Greece's defiance of EU austerity demands and continued pressure on the euro. In addition, yield-hungry investors were swapping equities for EU-sovereign bonds.

Crude oil was down $1.02 to $43.63 per barrel. Natural gas was down $0.11 to $2.83 per 1 million BTU. Gold was up $19.30 to $1,170.40 an ounce, while silver was up $0.56 to $16.10 an ounce. Copper was up $0.09 to $2.66 per pound.

Among energy ETFs, the United States Oil Fund was down 3.64% to $16.15 with the United States Natural Gas Fund was down 3.10% to $14.21. Amongst precious-metal funds, the Market Vectors Gold Miners ETF was down 0.68% to 21.56 while SPDR Gold Shares were up $0.01% to $112.34. The iShares Silver Trust was up 0.46% to $15.43.


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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.

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