Stocks Nearly Flat For Second Consecutive Session - U.S. Commentary

(RTTNews) - After showing a lack of direction for much of the previous session, stocks continue to turn in a lackluster performance during trading on Tuesday. The major averages have spent much of the day bouncing back and forth across the unchanged line.

Currently, the major averages are turning in a mixed performance. While the Dow is up 5.35 points or less than a tenth of a percent at 17,235.89, the Nasdaq is down 14.29 points or 0.3 percent at 4,891.18 and the S&P 500 is down 0.97 points or 0.1 percent at 2,032.69.

The choppy trading on Wall Street comes as traders seem uncertain about the near-term direction of the markets following recent volatility.

Stocks have recouped a significant portion of the sell-off seen in mid-August, but concerns about the global economy and the outlook for interest rates have limited the upside.

Traders are also digesting a mixed batch of earnings news, with shares of IBM (IBM) moving sharply lower after the tech giant reported weaker than expected third quarter revenues.

IBM reported third quarter earnings that beat analyst estimates but on a bigger than expected drop in revenues. The company also lowered its full year guidance.

Industrial conglomerate United Technologies (UTX) also reported weaker than expected third quarter revenues, although its earnings for the quarter exceeded estimates.

Meanwhile, insurance giant Travelers (TR) reported third quarter earnings and revenues that came in above analyst expectations.

On the U.S. economic front, the Commerce Department released a report showing that housing starts rose more than expected in September.

The report said housing starts climbed 6.5 percent to an annual rate of 1.206 million in September from the revised August estimate of 1.132 million. Economists had expected housing starts to rise to a rate of 1.147 million.

At the same time, the Commerce Department said building permits tumbled 5.0 percent to an annual rate of 1.103 million in September from 1.161 million in the previous month.

Sector News

Most of the major sectors are showing only modest moves on the day, although considerable weakness is visible among steel stocks. The NYSE Arca Steel Index is down by 2.2 percent, moving lower for the third straight session

Biotechnology stocks have also come under pressure, dragging the NYSE Arca Biotechnology Index down by 2.2 percent. Exact Sciences (EXAS), Alnylam Pharmaceuticals (ALNY), and Agios Pharmaceuticals (AGIO) are turning in some of the worst performances.

On the other hand, gold stocks have shown a substantial move to the upside on the day, driving the NYSE Arca Gold Bugs Index up by 3.7 percent. The strength in the sector comes as gold for December delivery is climbing $3.10 to $1,175.90 an ounce.

Railroad, oil service, and housing stocks are also seeing notable strength, helping to offset the weakness in the aforementioned sectors.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Tuesday. Japan's Nikkei 225 Index rose by 0.4 percent, while Hong Kong's Hang Seng Index fell by 0.4 percent.

Meanwhile, the major European markets all moved to the downside on the day. While the French CAC 40 Index fell by 0.6 percent, the German DAX Index and the U.K.'s FTSE 100 Index edged down by 0.2 percent and 0.1 percent, respectively.

In the bond market, treasuries have moved moderately after ending the previous session nearly flat. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 4.3 basis points at 2.071 percent.