Stocks Give Back Ground But Remain Mostly Positive - U.S. Commentary

(RTTNews) - After moving notably higher earlier in the session, stocks have given back some ground in recent trading on Wednesday. The pullback reflects the recent volatility on Wall Street, with traders seemingly reluctant to make significant moves.

Currently, the major averages remain in positive territory but well off their highs for the session. The Dow is up 71.30 points or 0.4 percent at 18,083.24, the Nasdaq is up 21.58 points or 0.4 percent at 5,098.10 and the S&P 500 is up 3.70 points or 0.2 percent at 2,113.30.

The early strength on Wall Street was partly attributed to optimism that Greece will finally reach an agreement with its international creditors.

Greek Prime Minister Alexis Tsipras is set to meet with senior European officials in Brussels to be presented with what is said to be the final proposal to break the stalemate.

Traders were also reacting to a slew of U.S. economic data, including a report from payroll processor ADP showing a notable re-acceleration in the pace of private sector job growth in the month of May.

ADP said the private sector added 201,000 jobs in May following a downwardly revised increase of 165,000 jobs in April. Economists had expected an increase of about 200,000 jobs.

The Commerce Department also released a report showing that the U.S. trade deficit narrowed by more than expected in the month of April.

The report said the trade deficit narrowed to $40.9 billion in April from a revised $50.6 billion in March, while economists had expected the deficit to drop to $44.0 billion.

Meanwhile, the Institute for Supply Management released a report showing that its index of activity in the service sector fell to its lowest level in over a year in May.

The ISM said its non-manufacturing index dropped to 55.7 in May after climbing to a five-month high of 57.8 in April.

A reading above 50 indicates continued growth in the service sector, but economists had expected the index to show a much more modest drop to a reading of 57.2.

With the much bigger than expected decrease, the non-manufacturing index fell to its lowest level since April of 2014.

As mentioned above, however, traders seem somewhat reluctant to place significant bets ahead of the release of the highly anticipated monthly jobs report on Friday.

Sector News

Trucking stocks continue to see considerable strength in mid-day trading, with the Dow Jones Trucking Index jumping by 2.8 percent. The index is climbing further off the seven-month closing low it set last Friday.

YRC Worldwide (YRCW) and C.H. Robinson (CHRW) are posting standout gains within the trucking sector, surging up by 6.9 percent and 5.2 percent, respectively.

Notable strength also remains visible among financial stocks, with the Dow Jones Banks Index and the NYSE Arca Broker/Dealer Index both up by 1.2 percent.

On the other hand, utilities stocks are extending the steep drop seen in the previous session, with the Dow Jones Utilities Average tumbling by 1.6 percent. With the loss, the index has fallen to its lowest intraday level in well over two months.

Gold and commercial real estate stocks have also come under pressure on the day, contributing to the pullback by the broader markets.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Wednesday. Japan's Nikkei 225 Index fell by 0.3 percent, while Australia's All Ordinaries Index slumped by 0.9 percent.

Meanwhile, the major European markets ended the day on the upside but well off their best levels. While the U.K.'s FTSE 100 Index rose by 0.3 percent, the French CAC 40 Index and the German DAX Index advanced by 0.6 percent and 0.8 percent, respectively.

In the bond market, treasuries are extending the sell-off seen in the two previous sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is surging up 9.1 basis points to 2.357 percent.