Stocks Seeing Further Downside After Sell-Off At The Open - U.S. Commentary

(RTTNews) - After moving sharply lower at the open, stocks continue to see substantial weakness in early trading on Tuesday. The major averages are stuck firmly in negative territory, more than offsetting the modest gains posted in the previous session.

In recent trading, the major averages have seen some further downside, falling to new lows for the session. The Dow is down 333.04 points or 1.9 percent at 17,345.66, the Nasdaq is down 92.00 points or 1.9 percent at 4,679.76 and the S&P 500 is down 30.17 points or 1.5 percent at 2,026.92.

A negative reaction to a batch of earnings news from several big-name companies contributed to the initial sell-off on Wall Street.

Shares of Microsoft (MSFT) have shown a particularly steep drop after the software giant reported second quarter earnings that matched analyst estimates but provided disappointing guidance.

Caterpillar (CAT), DuPont (DD), and Procter & Gamble (PG) have also come under pressure after reporting their quarterly results.

Early selling pressure was also generated by a report from the Commerce Department showing a substantial decrease in durable goods orders in the month of December.

The report said durable goods orders tumbled by 3.4 percent in December following a revised 2.1 percent decrease in November.

Economists had expected durable goods orders to increase by 0.5 percent compared to the 0.7 percent drop originally reported for the previous month.

Excluding a sharp drop in orders for transportation equipment, durable goods orders fell by a more modest 0.8 percent in December compared to a 1.3 percent decrease in November.

Meanwhile, traders largely seem to have shrugged off a pair of upbeat reports on new home sales and consumer confidence.

Software stocks are seeing significant weakness following the news from Microsoft, with the Dow Jones Software Index plunging by 5.7 percent. With the drop, the index has fallen to a three-month low.

Internet, computer hardware, semiconductor, and railroad stocks are also seeing considerable weakness, moving lower along with most of the other major sectors.

In overseas trading, stock markets across the Asia-Pacific region turned in another mixed performance on Tuesday. Japan's Nikkei 225 Index surged up by 1.7 percent, while Hong Kong's Hang Seng Index fell by 0.4 percent.

Meanwhile, the major European markets have all come under pressure on the day. While the U.K.'s FTSE 100 Index has slumped by 0.8 percent, the German DAX Index and the French CAC 40 Index are down by 1.1 percent and 1.5 percent, respectively.

In the bond market, treasuries have shown a strong move to the upside amid the sell-off on Wall Street. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 6.8 basis points at 1.76 percent.