Major Averages Remain Mixed In Mid-Day Trading - U.S. Commentary

(RTTNews) - After moving in opposite directions early in the session, the major averages continue to turn in a mixed performance in mid-day trading on Wednesday. While the Dow remains stuck in the red, the broader Nasdaq and S&P 500 are hovering in positive territory.

Currently, the Dow is down 32.04 points or 0.2 percent at 20,491.24, while the Nasdaq is up 40.62 points or 0.7 percent at 5,890.09 and the S&P 500 is up 6.03 points or 0.3 percent at 2,348.22.

A notable decline by shares of IBM Corp. (IBM) is weighing on the Dow, with the tech giant tumbling by 5 percent to its lowest intraday level in over four months.

The steep drop by IBM comes after the company reported first quarter earnings that beat analyst estimates but on weaker than expected revenues.

Meanwhile, some positive sentiment has been generated by upbeat earnings news from Morgan Stanley (MS) after disappointing results from Goldman Sachs (GS) weighed on the markets on Tuesday

Shares of Morgan Stanley are up by 2.7 percent after the financial services giant reported better than expected first quarter results.

Yahoo (YHOO), which is in the process of selling its core internet business to Verizon (VZ), also reported first quarter results that exceeded analyst estimates.

Overall trading activity is somewhat subdued, however, with lingering geopolitical uncertainty keeping some traders on the sidelines.

Late in the trading day, the Federal Reserve is due to release its Beige Book, a compilation of anecdotal evidence on economic conditions in the twelve Fed districts.

The Beige Book may shed some additional light on the outlook for interest rates ahead of the Fed's monetary policy meeting early next month.

Sector News

Airline stocks have shown a strong move to the upside on the day, driving the NYSE Arca Airline Index up by 1.5 percent. With the advance, the index has reached a two-month intraday high.

Hawaiian airlines parent Hawaiian Holdings (HA) and SkyWest (SKYW) are turning in two of the sector's best performances. United Continental (UAL) has also rebounded after falling sharply on Tuesday.

Notable strength has also emerged among semiconductor stocks, as reflected by the 1 percent gain being posted by the Philadelphia Semiconductor Index. The index is climbing further off the two-month closing low it set last Thursday.

Chip maker Lam Research (LRCX) is leading the sector higher after reporting fiscal third quarter results that exceeded analyst estimates on both the top and bottom lines.

Biotechnology, internet, and computer hardware stocks are also seeing some strength in mid-day trading, while gold stocks have moved sharply lower on the day.

Reflecting the weakness in the gold sector, the NYSE Arca Gold Bugs Index has tumbled by 3.6 percent. The weakness in the sector comes as gold for June delivery is sliding $13.70 to $1,280.40 an ounce.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower on Wednesday. China's Shanghai Composite Index slid by 0.8 percent, while Hong Kong's Hang Seng Index fell by 0.4 percent. However, Japan's Nikkei 225 Index bucked the downtrend and inched up by 0.1 percent.

Meanwhile, the major European markets ended the day mixed. While the U.K.'s FTSE 100 Index dropped by 0.5 percent, the German DAX Index inched up by 0.1 percent and the French CAC 40 Index rose by 0.3 percent.

In the bond market, treasuries are giving back ground after ending the previous session notably higher. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 4.1 basis points at 2.220 percent.