Nasdaq Pulls Back Sharply After Briefly Joining Dow In Positive Territory

(RTTNews) - The major U.S. stocks indexes moved in starkly opposite directions early in the session on Wednesday and continue to turn in a mixed performance in afternoon trading.

While the Nasdaq climbed well off its early lows and briefly reached positive territory, the tech-heavy index has once again pulled back sharply in recent trading.

Currently, the Nasdaq is down 174.00 points or 1.6 percent at 11,025.11, and the S&P 500 is down 15.85 points or 0.4 percent at 3,843.26.

Meanwhile, the Dow has pulled back well off its best levels of the day but remained up 77.44 points or 0.2 percent at 31,914.18.

The steep drop by the Nasdaq comes amid a negative reaction to earnings news from tech giants Microsoft (MSFT) and Alphabet (GOOGL).

Shares of Microsoft are tumbling by 6.4 percent after the software giant reported better than expected fiscal first quarter results but provided disappointing guidance.

Google parent Alphabet has also plunged by 7.8 percent after reporting third quarter results that missed analyst estimates on both the top and bottom lines.

On the other hand, the Dow is benefiting from a strong gain by shares of Visa (V), with the credit card giant jumping by 4.2 percent after reporting better than expected third quarter results.

In economic news, the Commerce Department released a report showing new home sales in the U.S. pulled back sharply in September after unexpectedly skyrocketing in August, although the decrease was smaller than expected.

The report showed new home sales tumbled by 10.9 percent to an annual rate of 603,000 in September after soaring by 24.7 percent to a revised rate of 677,000 in August.

Economists had expected new home sales to plunge by 14.6 percent to a rate of 585,000 from the 685,000 originally reported for the previous month.

Sector News

Tobacco stocks have shown a substantial move to the upside on the day, with the NYSE Arca Tobacco Index skyrocketing by 7.0 percent to its best intraday level in well over a month.

Significant strength also remains visible among oil service stocks, as reflected by the 4.7 percent spike by the Philadelphia Oil Service Index. The index has shot up to a four-month intraday high.

The rally by oil service stocks comes amid a notable increase by the price of crude oil, with crude for December delivery surging $2.57 to $87.89 a barrel.

An increase by the price of gold is also contributing to strength among gold stocks, resulting in a 2.5 percent jump by the NYSE Arca Gold Bugs Index.

Telecom, steel and transportation stocks are also seeing significant strength on the day, while semiconductor and retail stocks have moved to the downside.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Wednesday. Japan's Nikkei 225 Index climbed by 0.7 percent, while China's Shanghai Composite Index advanced by 0.8 percent.

The major European markets have also moved to the upside over the course of the session. While the German DAX Index jumped by 1.1 percent, the U.K.'s FTSE 100 Index and the French CAC 40 Index rose by 0.6 percent and 0.4 percent, respectively.

In the bond market, treasuries are extending the significant rebound seen in the previous session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 8.7 basis points at 4.021 percent.