Stocks Fluctuate But Maintain Negative Bias - U.S. Commentary

(RTTNews) - On the heels of the rally seen in the previous session, stocks have fluctuated over the course of the trading session on Wednesday. The major averages have been bouncing back and forth across the unchanged line, although they have spent most of the day in the red.

Currently, the major averages are posting modest losses on the day. The Dow is down 27.16 points or 0.2 percent at 16,837.92, the Nasdaq is down 17.47 points or 0.4 percent at 4,672.13 and the S&P 500 is down 4.25 points or 0.2 percent at 1,974.10.

The choppy trading on Wall Street is partly due to volatility shown by the price of crude oil, which has been a key driver of the markets in recent weeks.

Crude oil for April delivery has bounced between a low of $33.55 a barrel and a high of $35.17 a barrel and is currently up $0.09 at $34.49 a barrel.

The price of crude oil has recovered after initially coming under pressure following the release of a report showing a sharp jump in weekly crude oil inventories.

Traders are also digesting a report from payroll processor ADP showing much stronger than expected private sector job growth in the month of February.

ADP said private sector employment jumped by 214,000 jobs in February following an increase of 193,000 jobs in January. Economists had expected employment to rise by about 185,000 jobs.

Mark Zandi, chief economist of Moody's Analytics, said, "Despite the turmoil in the global financial markets, the American job machine remains in high gear."

"Energy and manufacturing remain blemishes on the job market, but other sectors continue to add strongly to payrolls," he added. "Full-employment is fast approaching."

While the report paints a positive picture of the job market ahead of Friday's more closely watched Labor Department report, the data has also led to renewed concerns about the outlook for interest rates.

The Federal Reserve may shed some more light on the interest rate outlook later in the day with the release of its Beige Book.

The Beige Book, a collection of anecdotal reports from the twelve Fed districts, is used by the central bank to make upcoming monetary policy decisions.

Sector News

Despite the modest weakness being show by the broader markets, steel stocks are seeing substantial strength in mid-day trading. The NYSE Arca Steel Index has surged up by 4.4 percent to its best intraday level in three months.

Within the steel sector, L.B. Foster (FSTR), Olympic Steel (ZEUS), A.M. Castle & Co. (CAS), and U.S. Steel (X) are posting standout gains.

Gold stocks have also shown a strong move to the upside on the day, driving the NYSE Arca Gold Bugs Index up by 1.6 percent. The strength in the sector comes as gold for April delivery is climbing $7.90 to $1,238.70 an ounce.

While natural gas stocks are also seeing considerable strength, notable weakness remains visible among chemical stocks.

Other Markets

In overseas trading, stock markets across the Asia-Pacific moved notably higher following the overnight rally on Wall Street. Japan's Nikkei 225 Index surged up by 4.1 percent, while Hong Kong's Hang Seng Index jumped by 3.1 percent.

Meanwhile, the major European markets turned in a mixed performance on the day. While the U.K.'s FTSE 100 Index edged down by 0.1 percent, the French CAC 40 Index and the German DAX Index rose by 0.4 percent and 0.6 percent, respectively.

In the bond market, treasuries are seeing modest weakness, extending the steep drop seen in the previous session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 2.2 basis points at 1.856 percent.