Stocks Remain Stuck In The Red In Mid-Day Trading - U.S. Commentary

(RTTNews) - After coming under pressure earlier in the session, stocks remain mostly lower in mid-day trading on Thursday. The losses on the day come after the Nasdaq ended the previous session at a record closing high.

Currently, the major averages are stuck in negative territory. The Dow is down 80.98 points or 0.5 percent at 18,082.01, the Nasdaq is down 19.23 points or 0.4 percent at 5,087.36 and the S&P 500 is down 9.10 points or 0.4 percent at 2,114.38.

Ongoing uncertainty about the situation in Greece contributed to the early weakness on Wall Street following yesterday's mixed comments regarding the embattled nation's negotiations with its creditors.

While Greek Prime Minister Alexi Tsipras told reporters his government is close to an agreement to secure funding from its lenders, European Commission Vice President Valdis Dombrovskis said the two sides still have a ways to go.

The outcome of a meeting of G7 finance ministers in Dresden today and tomorrow could shed more light on how Greece's international creditors seek to end the impasse.

The early downward move also came on the heels of a sell-off in China, as the Shanghai Composite Index plummeted by 6.5 percent.

The weakness was seen as a reaction to announcements by several brokers concerning tightening requirements on margin financing ahead of an IPO influx next week.

A report from the National Association of Realtors showing a jump in pending home sales may also be weighing on the markets amid continued concerns about the outlook for interest rates.

NAR said its pending home sales index surged up 3.4 percent to 112.4 in April from a slightly upwardly revised 108.7 in March. Economists had expected the index to increase by about 0.8 percent.

A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.

With the bigger than expected increase, the pending home sales index reached its highest level since hitting 112.5 in May of 2006.

Sector News

Oil service stocks continue to see considerable weakness in mid-day trading, with the Philadelphia Oil Service Index down by 1.8 percent. With the drop, the index has fallen to its lowest intraday level in a month.

The losses by oil service stocks come amid a decrease by the price of crude oil, as crude for July delivery is sliding $0.36 to $57.15 a barrel.

Significant weakness also remains visible among natural gas stocks, as reflected by the 1.8 percent loss being posted by the NYSE Arca Natural Gas Index. The weakness in the sector comes as natural gas for July delivery is falling $0.122 to $2.725 per million BTUs.

Steel, railroad, and trucking stocks also remain under pressure in mid-day trading, while electronic storage stocks have shown a strong move to the upside on the day.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in another mixed performance during trading on Thursday. Japan's Nikkei 225 Index rose by 0.4 percent, while Hong Kong's Hang Seng Index plunged by 2.2 percent.

Most European stocks moved to the downside on the day, although the U.K.'s FTSE 100 Index edged up by 0.1 percent. The German DAX Index and the French CAC 40 Index dropped by 0.8 percent and 0.9 percent, respectively.

In the bond market, treasuries have moved modestly lower after initially showing a lack of direction. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 1.5 basis points at 2.15 percent.