Stocks Remain Little Changed In Mid-Day Trading - U.S. Commentary

(RTTNews) - Extending the lackluster performance seen in recent sessions, stocks continue to experience choppy trading on Monday. The major averages closed mixed in each of the four previous sessions.

Currently, the major averages are on opposite sides of the unchanged line. While the Nasdaq is up 27.73 points or 0.5 percent at 5,189.86, the Dow is down 9.17 points or 0.1 percent at 18,423.07 and the S&P 500 is down 0.45 points or less than a tenth of a percent at 2,173.15.

The lack of direction on Wall Street comes as traders remain reluctant to make any significant moves ahead of some key events later this week.

The Bank of England's monetary policy decision on Thursday is likely to be in focus along with the monthly U.S. jobs report due on Friday.

On the U.S. economic front, the Institute for Supply Management released a report this morning showing a modest slowdown in the pace of growth in the manufacturing sector in the month of July.

The ISM said its purchasing managers index dipped to 52.6 in July from 53.2 in June, although a reading above 50 still indicates growth in the manufacturing sector. Economists had expected the index to come in unchanged.

The drop by the manufacturing index came after it hit its highest level since reaching 53.3 in February of 2015 in the previous month.

A separate report from the Commerce Department showed an unexpected decline in construction spending in the month of June.

The report said construction fell by 0.6 percent to an annual rate of $1.134 trillion in June. The decrease came as a surprise to economists, who had expected spending to climb by 0.6 percent.

Sector News

Biotechnology stocks have shown a substantial move to the upside on the day, driving the NYSE Arca Biotechnology Index up by 2.9 percent. With the gain, the index has reached a nearly seven-month intraday high.

Ionis Pharmaceuticals (IONS) is leading the biotech sector higher after a study of a drug it is developing with Biogen (BIIB) to treat spinal muscular atrophy met its primary endpoint.

On the other hand, energy stocks continue to see considerable weakness amid a drop by the price of crude oil. Crude for September delivery is currently tumbling $1.34 to $40.26 a barrel.

Reflecting the weakness in the energy sector, the NYSE Arca Natural Gas Index is down by 3.3 percent, the Philadelphia Oil Service Index is down by 2.8 percent and the NYSE Arca Oil & Gas Index is down by 2.6 percent.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Monday. Japan's Nikkei 225 Index rose by 0.4 percent, while Hong Kong's Hang Seng Index jumped by 1.1 percent.

Meanwhile, the major European markets all moved to the downside on the day. While the German DAX Index edged down by 0.1 percent, the U.K.'s FTSE 100 Index and the French CAC 40 Index fell by 0.5 percent and 0.7 percent, respectively.

In the bond market, treasuries are giving back some ground following recent strength. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 2.9 basis points at 1.487 percent.