Stocks Showing A Lack Of Direction - U.S. Commentary

(RTTNews) - After trending higher in recent sessions, stocks have shown a lack of direction over the course of the trading day on Monday. The major averages have spent the day bouncing back and forth across the unchanged line.

Currently, the major averages are turning in a mixed performance. While the S&P 500 is down 0.21 points or less than a tenth of a percent at 2.049.37, the Dow is up 16.13 points or 0.1 percent at 17,618.43 and the Nasdaq is up 5.72 points or 0.1 percent at 4,801.37.

The choppy trading on Wall Street comes as traders are expressing some uncertainty about the near-term outlook for the markets on the heels of the recent strength.

The major averages have closed higher for five consecutive weeks and ended last Friday's trading at their best closing levels in well over two months.

The upcoming Easter holiday may also be contributing to the lackluster performance, with some traders away from their desks.

The economic calendar for this week is also relatively quiet compared to the slew of data that was released last week along with the Federal Reserve announcement.

Nonetheless, the National Association of Realtors released a report this morning showing a much steeper than expected pulling back in existing home sales in February.

NAR said existing home sales tumbled 7.1 percent to an annual rate of 5.08 million in February from 5.47 million in January. Economists had expected sales to show a more modest decrease to a rate of 5.31 million.

Reports on weekly jobless claims, new home sales and durable goods orders are also scheduled to be released in the coming days.

Among individual stocks, shares of Affymetrix (AFFX) have come under pressure after the gene testing company rejected a $1.5 billion takeover offer from Origin Technologies. Affymetrix claimed its bid from Thermo Fisher (TMO) remains the superior proposal.

BioMarin (BMRN) has also moved to the downside after revealing that a trial of its treatment for the rare disease phenylketonuria met its primary endpoint but fell short on its secondary endpoints.

On the other hand, shares of Valspar (VAL) have spiked sharply higher after the paint company agreed to be acquired by rival Sherwin-Williams (SWH) for $9.3 billion in cash.

Sector News

Most of the major sectors are showing only modest moves on the day, contributing to the lackluster performance by the broader markets.

Biotechnology stocks are seeing considerable strength, however, with the NYSE Arca Biotechnology Index jumping by 1.7 percent. The index is climbing further off the one-month closing low set last Thursday.

Biopharmaceutical company Celldex Therapeutics (CLDX) has helped to lead the biotech sector higher, surging up by 9.6 percent.

On the other hand, trucking stocks have come under pressure on the day, dragging the Dow Jones Trucking Index down by 1.1 percent. With the drop, the index is pulling back off its best closing level in almost a year.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Monday, with the Japanese markets closed for a holiday. China's Shanghai Composite Index jumped by 2.2 percent, while Australia's All Ordinaries Index fell by 0.3 percent.

The major European markets have also turned mixed on the day. While the German DAX Index has inched up by 0.1 percent, the U.K.'s FTSE 100 Index is down by 0.2 percent and the French CAC 40 Index is down by 0.7 percent.

In the bond market, treasuries are giving back ground after trending higher over the past few sessions. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 3.6 basis points at 1.907 percent.