Stocks Close Mixed Following Choppy Trading Session - U.S. Commentary

(RTTNews) - Stocks showed a lack of direction over the course of the trading session on Tuesday before finishing the day mixed. The lackluster performance came on the heels of the strong upward move shown by the markets last week.

The major averages ended the day on opposite sides of the unchanged line. While the Nasdaq rose 14.55 points or 0.3 percent to 4,948.05, the Dow fell 86.09 points or 0.5 percent to 17,787.13 and the S&P 500 edged down 2.11 points or 0.1 percent to 2,096.95.

The choppy trading on Wall Street came as traders seemed somewhat reluctant to make any significant moves ahead of the release of the closely watched monthly jobs report on Friday.

The Labor Department report, which is expected to show an increase of 158,000 jobs in May, could have a significant impact on the outlook for interest rates.

Traders largely seemed to shrug off the slew of U.S. economic data released this morning, including a Commerce Department report showing a jump in personal spending.

The Commerce Department said personal spending surged up by 1.0 percent in April after coming in unchanged in March. Economists had expected spending to climb by 0.7 percent.

The report also said personal income rose by 0.4 percent in April, matching the increase seen in the previous month as well as economist estimates.

Meanwhile, a separate report from the Conference Board showed an unexpected drop in consumer confidence in the month of May.

The Conference Board said its consumer confidence index dropped to 92.6 in May from 94.7 in April. The index had been expected to climb to 97.0.

MNI Indicators also released a report showing an unexpected contraction in Chicago-area business activity in May.

Sector News

Despite the lackluster performance by the broader markets, electronic storage stocks showed a substantial move to the upside on the day. The NYSE Arca Disk Drive Index surged up by 6.2 percent to its best closing level in two months.

Violin Memory (VMEM) turned in one of the storage sector's best performances, with the memory-based storage systems developers soaring by 35.2 percent.

Significant strength was also visible among gold stock, as reflected by the 1.3 percent gain posted by the NYSE Arca Gold Bugs Index. The gain by the index came after it ended last Friday's trading at its lowest closing level in over a month.

Biotechnology, railroad, and computer hardware stocks also moved notably higher on the day, while tobacco stocks moved to the downside.

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 surged up by 1 percent, but Australia's All Ordinaries Index dropped by 0.5 percent.

Meanwhile, the major European markets all moved lower on the day. While the French CAC 40 Index fell by 0.5 percent, the U.K.'s FTSE 100 Index and the German DAX Index dropped by 0.6 percent and 0.7 percent, respectively.

In the bond market, treasuries turned higher over the course of the session after seeing early weakness. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, dipped 1.7 basis points to 1.834 percent.

Looking Ahead

Trading on Wednesday may be impacted by reaction to reports on manufacturing activity and construction spending as well as the Federal Reserve's Beige Book.