Stocks Finish Choppy Trading Session Roughly Flat - U.S. Commentary

(RTTNews) - Following the sell-off seen in the previous session, stocks showed a lack of direction throughout the trading session on Tuesday. The major averages spent the day bouncing back and forth across the unchanged line, unable to sustain any significant moves.

The major averages eventually ended the day mixed. While the Nasdaq dipped 11.66 points or 0.2 percent to 4,891.43, the Dow inched up 9.72 points or 0.1 percent to 17,158.66 and the S&P 500 rose 4.05 points or 0.2 percent to 2,016.71.

The choppy trading on Wall Street came as traders expressed some uncertainty about the outlook for the markets following the steep losses posted on Monday.

A lack of major U.S. economic data also kept traders on the sidelines ahead of the release of some key economic reports in the coming days.

The monthly jobs report due on Friday is likely to be in the spotlight, although traders are also likely to keep an eye on reports on private sector employment, international trade and service sector activity.

The minutes of the latest Federal Reserve meeting are also likely to attract attention, as the central bank raised interest rates for the first time in nearly a decade following the meeting.

Among individual stocks, shares of Smith & Wesson (SWHC) moved sharply higher on the day after the gun maker raised its third quarter and full year guidance.

Smith & Wesson said the sell-through rate of its products at distribution has been stronger than originally anticipated, resulting in reduced distributor inventories of its firearms.

The news came as President Barack Obama announced a series of executive actions aimed at reducing gun violence in the U.S.

Solar equipment maker First Solar (FSLR) also saw notable strength after Goldman Sachs upgraded its rating on the company's stock to Buy from Neutral.

On the other hand, shares of Ford (F) and General Motors (GM) came under pressure even though both auto giants reported strong December sales growth.

Sector News

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

Commercial real estate stocks saw substantial strength, however, with the Morgan Stanley REIT Index jumping by 2 percent. The gain by the index came after it closed lower in the three previous sessions.

Ramco-Gershenson Properties Trust (RPT), Pennsylvania Real Estate Investment Trust (PEI), and One Liberty Properties (OLP) turned in some of the sector's best performances.

Significant strength was also visible among trucking stocks, as reflected by the 1.5 percent gain posted by the Dow Jones Trucking Index. C.H. Robinson (CHRW) and Heartland Express (HTLD) posted standout gains.

On the other hand, oil service stocks came under pressure on the day, dragging the Philadelphia Oil Service Index down by 1.9 percent. The weakness in the sector came as crude oil for February delivery slid $0.79 to $35.97 a barrel.

Semiconductor, networking, and computer hardware stocks also saw some weakness, contributing to the lower close by the tech-heavy Nasdaq.

Other Markets

In overseas trading, most stock markets across the Asia-Pacific region saw further downside during trading on Tuesday. Japan's Nikkei 225 Index fell by 0.4 percent, while Hong Kong's Hang Seng Index slid by 0.7 percent.

Meanwhile, the major European markets regained some ground on the day. While the U.K.'s FTSE 100 Index advanced by 0.7 percent, the French CAC 40 Index and the German DAX Index both rose by 0.3 percent.

In the bond market, treasuries showed a lack of direction throughout the session before closing roughly flat. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, inched up by less than a basis point to 2.248 percent.

Looking Ahead

The reports on private sector employment, international trade, and service sector activity are likely to attract attention on Wednesday along with the minutes of the Fed's latest monetary policy meeting.