Stocks Continue To See Modest Weakness In Mid-Day Trading - U.S. Commentary

(RTTNews) - Following the rally seen in the previous session, stocks have moved modestly lower over the course of the trading day on Friday. Selling pressure has remained relatively subdued, however, limiting the downside for the markets.

In recent trading, the Dow has pulled back to a new low for the session, with the blue chip index currently down 50.55 points or 0.3 percent at 18,065.29. The Nasdaq is down 10.76 points or 0.2 percent at 5,122.18 and the S&P 500 is down 5.68 points or 0.3 percent at 2,115.56.

The weakness on Wall Street may be partly due to profit taking following recent gains, which lifted the tech-heavy Nasdaq to new record highs on Thursday.

Concerns about the situation in Greece may also be weighing on the markets as the debt-laden country remains at an impasse with its international creditors.

A meeting of European finance ministers on Thursday did not make any significant progress, and eurozone leaders are set to hold an emergency summit on Monday to discuss the issue again.

Greece has indicated that it will be unable to make a 1.5 billion euro payment to the International Monetary Fund at the end of the month without further aid, leading to a default.

Capital Economics said, "The odds of Greece defaulting on its debt, and possibly exiting the euro-zone too, seem to be growing by the day."

Nonetheless, overall trading activity has remained somewhat subdued as traders take a step back following the recent upward move.

A lack of major U.S. economic data is also keeping some traders on the sidelines ahead of the release of key reports on durable goods orders, new and existing home sales, and personal income and spending next week.

Among individual stocks, shares of Healthways (HWAY) have fallen sharply on the day after the wellness program provider cuts its full-year revenue guidance.

Candy maker Hershey (HSY) has also moved lower after forecasting full-year earnings below analyst estimates. The company also announced plans to cut about 300 jobs.

Meanwhile, shares of KB Home (KBH) are moving notably higher after the homebuilder reported second quarter earnings that came in above analyst estimates.

Sector News

Oil service stocks continue to see considerable weakness in mid-day trading, with the Philadelphia Oil Service Index falling by 1.6 percent. With the drop, the index has fallen to its worst intraday level in well over two months.

The weakness among oil service stocks comes amid a notable decrease by the price of crude oil, with crude for July delivery tumbling $1.12 to $59.33 a barrel.

Natural gas, steel, and software stocks are also seeing some weakness on the day, although selling pressure has remained relatively subdued.

On the other hand, significant strength is visible among airline stocks, as reflected by the 1.2 percent gain being posted by the NYSE Arca Airline Index. American Airlines (AAL) and SkyWest (SKYW) are posting standout gains.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Friday. Japan's Nikkei 225 Index advanced by 0.9 percent, while Hong Kong's Hang Seng Index rose by 0.3 percent.

Meanwhile, the major European markets turned in a mixed performance on the day. While the German DAX Index fell by 0.5 percent, the U.K.'s FTSE 100 Index closed just above the unchanged line and the French CAC 40 Index edged up by 0.3 percent.

In the bond market, treasuries are moving notably higher, more than offsetting the pullback seen on Thursday. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 7.5 basis points at 2.276 percent.