Stocks Close Roughly Flat Ahead Of Monthly Jobs Report - U.S. Commentary

(RTTNews) - With traders reluctant to make any significant moves following the strong upward move seen over the past several sessions, stocks showed a lack of direction throughout the trading day on Monday before closing roughly flat.

The major averages ended the day mixed, although they all closed near the unchanged line. While the Dow dipped 7.45 points or 0.1 percent to 15,392.20, the Nasdaq rose 5.77 points or 0.2 percent to 3,920.05 and the S&P 500 inched up 0.16 points or less than a tenth of a percent to 1,744.66.

The lackluster performance on Wall Street came as traders took a break following the upward trend seen over the past two weeks, which lifted the S&P 500 to record highs.

Traders also seemed to be staying on the sidelines ahead of the release of the Labor Department's monthly jobs report tomorrow morning.

The September jobs report was originally scheduled for release on October 4th but was delayed as a result of the government shutdown.

Economists expect the report to show an increase about 185,000 jobs in September compared to the addition of 169,000 jobs in August. The unemployment rate is expected to remain unchanged at 7.3 percent.

Meanwhile, traders largely shrugged off a report from the National Association of Realtors showing that existing home sales pulled back in September after reaching their highest level in nearly four years.

NAR said existing home sales fell 1.9 percent to a seasonally adjusted annual rate of 5.29 million in September from a downwardly revised 5.39 million in August.

Economists had been expecting existing home sales to drop to an annual rate of 5.30 million from the 5.48 million originally reported for the previous month.

Among individual stocks, shares of Hasbro (HAS) jumped 5.3 percent after the toymaker reported better than expected third quarter results.

Communications equipment maker Tellabs (TLAB) also turned in a strong performance after agreeing to be acquired by private equity firm Marlin Equity Partners for $891 million.

On the other hand, shares of Halliburton (HAL) fell by 3.5 percent after the oil service giant reported third quarter revenues that came in below analyst estimates.

Sector News

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

Gold stocks saw significant strength, however, with the NYSE Arca Gold Bugs Index surging up by 2.3 percent. The gain extended a recent upward move by the index, which has climbed well off the three-month lows set earlier this month.

The strength among gold stocks came amid a modest increase by the price of the precious metal, with gold for December delivery edging up $1.20 to $1,315.80 an ounce.

Railroad and computer hardware stocks also saw some strength on the day, although buying interest remained relatively subdued.

Meanwhile, considerable weakness was visible among biotechnology stocks, as reflected by the 1.7 percent drop by the NYSE Arca Biotechnology Index. Exact Sciences (EXAS) helped to lead the sector lower, falling by 5.2 percent.

Housing and defense stocks also moved to the downside, largely offsetting the strength seen in the aforementioned sectors.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Monday. Japan's Nikkei 225 Index advanced by 0.9 percent, while Hong Kong's Hang Seng Index rose by 0.4 percent.

Meanwhile, the major European markets turned in a mixed performance on the day. While the French CAC 40 Index dipped by 0.2 percent, the U.K.'s FTSE 100 Index climbed by 0.5 percent and the German DAX Index closed just above the unchanged line.

In the bond market, treasuries gave back some ground after moving notably higher last week. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, rose by 2 basis points to 2.609 percent.

Looking Ahead

Trading on Tuesday is likely to be driven by reaction to the monthly jobs report, while the Commerce Department is also due to release its report on construction spending.

Additionally, Dow components DuPont (DD), Travelers (TRV), and United Technologies (UTX) are among the companies due to release their quarterly results before the start of trading on Tuesday.