Stocks Recover From Initial Weakness To Close Roughly Flat - U.S. Commentary

(RTTNews) - After recovering from an early move to the downside, stocks showed a lack of direction throughout the remainder of the trading session on Wednesday. The choppy trading came amid another relatively quiet news day.

The major averages ended the day on opposite sides of the unchanged line. While the Dow edged down 11.17 points or 0.1 percent to 16,340.08, the Nasdaq rose 16.14 points or 0.4 percent to 4,323.33 and the S&P 500 crept up 0.57 points or less than a tenth of a percent to 1,868.20.

The initial weakness on Wall Street came on the heels of a sell-off in the overseas markets, with stocks in both Asia and Europe coming under pressure on the day.

Peter Boockvar, chief market analyst at the Lindsey Group, said, "With today's declines, most major European markets are at or below the closing lows of March 3rd, the Monday when markets finally reacted lower to Putin's war games."

"In Asia, the Shanghai, Hang Seng, Kospi, ASX, Singapore Straits and Japanese Topix are also at or near the March 3rd close but also are being influenced by China's growth concerns," he added.

While concerns about China and Ukraine also weighed on Wall Street at the open, traders seemed reluctant to make any significant moves amid another quiet day on the U.S. economic front.

The subsequent recovery came as traders looked ahead to the release of closely watched reports on retail sales and producer prices over the next two days.

Among individual stocks, shares of VeriFone (PAY) moved sharply higher after the maker of card-payment systems reported better than expected first quarter results and provided upbeat guidance.

Packaged food company Diamond Foods (DMND) also turned in a strong performance on the day after reporting better than expected second quarter results.

On the other hand, shares of Express (EXPR) saw significant weakness after the apparel retailer reported weaker than expected fourth quarter results and provided disappointing first quarter guidance.

Sector News

While many of the major sectors ended the day showing only modest moves, substantial strength was visible among gold stocks. The NYSE Arca Gold Bugs Index surged up 2.8 percent to its best closing level in over four months.

The strength in the gold sector came amid a notable increase by the price of the precious metal, with gold for April delivery climbing $23.80 to $1,370.50 an ounce.

Networking and electronic storage stocks also moved to the upside on the day, contributing to the gain posted by the tech-heavy Nasdaq.

Considerable strength was also visible among utilities stocks, as reflected by the 1.2 percent gain posted by the Philadelphia Utility Sector Index. The gain by the index came after it ended the previous session at its lowest closing level in a month.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region saw significant weakness during trading on Wednesday. Japan's Nikkei 225 Index plunged by 2.6 percent, while Hong Kong's Hang Seng Index tumbled by 1.7 percent.

The major European markets also came under pressure on the day. While the German DAX Index fell by 1.3 percent, the French CAC 40 Index and the U.K.'s FTSE 100 Index both dropped by 1 percent.

In the bond market, treasuries moved notably higher, climbing further off their recent lows. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 4 basis points to 2.725 percent.

Looking Ahead

Following several quiet days, the economic calendar picks up on Thursday with the release of reports on weekly jobless claims, retail sales, and import and export prices.