U.S. Stocks Move To The Downside In Morning Trading

(RTTNews) - Stocks have moved moderately lower in morning trading on Tuesday after closing mixed for two consecutive sessions. The major averages have all moved to the downside, with the Dow pulling back off its best closing level in over a month.

In recent trading, the major averages have climbed off their worst levels but remain firmly in negative territory. The Dow is down 83.78 points or 0.3 percent at 26,751.73, the Nasdaq is down 49.81 points or 0.6 percent at 8,037.63 and the S&P 500 is down 16.24 points or 0.6 percent at 2,962.19.

The weakness on Wall Street comes amid some uncertainty ahead of the European Central Bank's monetary policy decision on Thursday as well as next week's Federal Reserve meeting.

Both the ECB and the Fed are expected to cut interest rates in reaction to recent indications of a slowdown by the global economy.

With the major averages back within striking distance of record highs, traders may be questioning whether stocks will see further upside in an economy that requires support from global central banks to avoid recession.

Overall trading activity remains somewhat subdued, however, with some traders sticking to the sidelines amid another quiet day on the U.S. economic front.

The weaker than expected jobs data released last Friday raised concerns about the economic outlook but also reinforced expectations of another interest rate cut by the Fed next week.

Reports on producer and consumer price inflation, retail sales, and consumer sentiment are likely to attract attention in the coming days.

Among individual stocks, shares of Ford (F) are sharply lower after Moody's cut the auto giant's debt rating to junk status to reflect the considerable operating, competitive, and market challenges facing the company.

Pharmaceutical stocks are extending the significant downward move seen in the previous session, dragging the NYSE Arca Pharmaceutical Index down by 1.6 percent.

Considerable weakness has also emerged among commercial real estate stocks, as reflected by the 1.6 percent drop by the Dow Jones U.S. Real Estate Index.

On the other hand, energy stocks are extending yesterday's rally amid a continued increase by the price of crude oil. Crude for October delivery is climbing $0.68 to $58.53 a barrel after jumping $1.33 to $57.85 a barrel on Monday.

Reflecting the strength in the energy sector, the NYSE Natural Gas Index and the Philadelphia Oil Service Index are up by 2.8 percent and 2.7 percent, respectively, and the NYSE Arca Oil Index is up by 1.9 percent.

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 China's Shanghai Composite Index slipped by 0.1 percent.

Meanwhile, the major European markets have all moved to the upside on the day. While the German DAX Index has risen by 0.5 percent, the U.K.'s FTSE 100 Index and the French CAC 40 Index are up by 0.2 percent and 0.1 percent, respectively.

In the bond market, treasuries are extending the notable downward move seen in the previous session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 4.8 basis points at 1.670 percent.

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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