U.S. Stocks Nearly Flat After Recovering From Early Weakness
(RTTNews) - With traders once again shrugging off negative news on the trade front, stocks have climbed back near the unchanged line after course of the trading session on Monday after seeing early weakness.
Currently, the major averages are nearly flat, showing moves of less than a tenth of a percent each. While the Nasdaq is down 2.27 points at 8,538.56, the Dow is up 9.56 points at 28,014.45 and the S&P 500 is up 0.31 points at 3,120.77.
Stocks initially moved to the downside after a tweet from CNBC's Beijing Bureau Chief Eunice Yoon suggested Chinese officials have grown pessimistic about the chances for a trade deal.
"Mood in Beijing about #trade deal is pessimistic, government source tells me. #China troubled after Trump said no tariff rollback. (China thought both had agreed in principle.)" Yoon tweeted.
She added, "Strategy now to talk but wait due to impeachment, US election. Also prioritize China economic support."
Yoon's tweet offset earlier positive sentiment in reaction to weekend report from Chinese state media indicating the U.S. and China had "constructive discussions" regarding a phase one trade deal in a high-level phone call.
U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin reportedly talked with Chinese Vice Premier Liu He about the core issues for an agreement.
However, traders have recently shown a predilection for taking upbeat reports about the trade talks at face value while shrugging off the negative news.
The prevailing optimism about an eventual trade deal has led to a steady upward trend on Wall Street for the past month and a half.
On the U.S. economic front, the National Association of Home Builders released a report showing homebuilder confidence edged slightly lower in the month of November.
The report said the NAHB/Wells Fargo Housing Market Index slipped to 70 in November after climbing to 71 in October. Economists had expected the index to come in unchanged.
The modest decrease came after the housing market index rose for four straight months to reach its highest level since hitting a matching reading in February of 2018.
Most of the major sectors are showing only modest moves in mid-day trading, contributing to the lackluster performance by the broader markets.
Energy stocks continue to see substantial weakness, however, with decreases in associated commodities prices weighing on the sector.
With natural gas for December delivery slumping $0.082 to $2.606 per million BTUs, the NYSE Arca Natural Gas Index is plunging by 3.6 percent, while the Philadelphia Oil Service Index is down by 2.3 percent as crude for December delivery is tumbling $1.03 to $56.69 a barrel.
On the other hand, gold stocks have shown a strong move to the upside, driving the NYSE Arca Gold Bugs Index up by 1.8 percent.
The strength among gold stocks comes amid a relatively modest increase by the price of the precious metal, with gold for December delivery rising $2.90 to $1,471.40 an ounce.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Monday. Japan's Nikkei 225 Index rose by 0.5 percent, while Australia's S&P/ASX 200 Index slid by 0.4 percent.
The major European markets also ended the day mixed. While the U.K.'s FTSE 100 Index inched up by 0.1 percent, the French CAC 40 Index dipped by 0.2 percent and the German DAX Index fell by 0.3 percent.
In the bond market, treasuries have shown a strong move back to the upside after last Friday's pullback. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 2.7 basis points at 1.807 percent.
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