Major Averages Climb Back Near Unchanged After Early Weakness - U.S. Commentary

(RTTNews) - After moving to the downside early in the session, stocks have climbed back near the unchanged line over the course of the trading day on Friday. The recovery reflects the lack of direction shown by the major averages in recent sessions.

Currently, the major averages are turning in a mixed performance. While the Nasdaq is up 5.97 points or 0.1 percent at 6,121.93, the Dow is down 21.82 points or 0.1 percent at 20,897.60 and the S&P 500 is down 3.78 points or 0.2 percent at 2,390.66.

The early weakness on Wall Street came on the heels of the release of a Commerce Department report showing a smaller than expected increase in retail sales in the month of April.

The Commerce Department said retail sales climbed by 0.4 percent in April compared to economist estimates for 0.6 percent growth.

However, the report also said retail sales inched up by a revised 0.1 percent in March versus the 0.2 percent drop originally reported.

Excluding a rebound in auto sales, retail sales rose by 0.3 percent in April, matching the increase seen in the previous month as well as economist estimates.

A separate report from the Labor Department showed that consumer prices rebounded in line with economist estimates in the month of April.

The Labor Department said its consumer price index rose by 0.2 percent in April after falling by 0.3 percent in March.

Excluding food and energy prices, core consumer prices inched up by 0.1 percent in April after dipping by 0.1 percent in March. Core prices had been expected to rise by 0.2 percent.

Meanwhile, the University of Michigan released a report showing a modest improvement in consumer sentiment in the month of May.

The report said the preliminary reading on the consumer sentiment index for May came in at 97.7 compared to the final April reading of 97.0. Economists had expected the index to inch up to 97.3.

Sector News

Most of the major sectors are showing only modest moves on the day, contributing to the lackluster performance by the broader markets.

Gold stocks are seeing significant strength, however, with the NYSE Arca Gold Bugs Index climbing by 1.2 percent. The strength in the sector comes as gold for June delivery is rising $4.30 to $1,228.50 an ounce.

On the other hand, notable weakness remains visible among banking stocks, as reflected by the 1.2 percent drop by the Dow Jones Banks Index.

Steel and oil service stocks have also moved to the downside on the day, although selling pressure has remained relatively subdued.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in another mixed performance during trading on Friday. Japan's Nikkei 225 Index fell by 0.4 percent, while China's Shanghai Composite Index advanced by 0.7 percent.

Meanwhile, the major European markets all moved higher on the day. While the U.K.'s FTSE 100 Index climbed by 0.7 percent, the German DAX Index and the French CAC 40 Index rose by 0.5 percent and 0.4 percent, respectively.

In the bond market, treasuries have shown a significant move to the upside following the disappointing retail sales data. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 7.4 basis points at 2.326 percent.