WASHINGTON (dpa-AFX) - After moving to the downside early in the session, stocks continue to see modest weakness in afternoon trading on Monday. The tech-heavy Nasdaq has climbed well off its worst levels but remains slightly lower after ending last Friday's trading at a record closing high.
Currently, the Nasdaq is down 8.43 points or 0.1 percent at 16,420.39, the S&P 500 is down 9.26 points or 0.2 percent at 5,224.92 and the Dow is down 144.21 points or 0.4 percent at 39,331.69.
Weakness among technology stocks weighed on the markets early in the session, with semiconductor giant Intel (INTC) plunging by as much as 4.7 percent to its lowest intraday level in over four months.
The steep drop came after a report from the Financial Times said China has introduced new guidelines to phase microprocessors from Intel and Advanced Micro Devices (AMD) out of government PCs and servers.
Intel has climbed well off its worst levels but remains down by 1.1 percent, while AMD have rebounded into positive territory after seeing early weakness.
Shares of Microsoft (MSFT) are also down by 1.2 percent after the FT said stricter Chinese government procurement guidance also seeks to sideline the company's Windows operating system and foreign-made database software in favor of domestic options.
Selling pressure has remained relatively subdued, however, as traders seem reluctant to make more significant moves ahead of the release of some key economic data in the coming days.
Traders are likely to keep an eye on reports on durable goods orders, consumer confidence and pending home sales, although a report on personal income and spending that includes readings on inflation said to be preferred by the Fed will be released when the markets are closed for Good Friday.
The Commerce Department released a report this morning showing new home sales in the U.S. unexpectedly decreased in the month of February.
The report said new home sales dipped by 0.3 percent to an annual rate of 662,000 in February after jumping by 1.7 percent to a revised rate of 664,000 in January.
Economists had expected new home sales to surge by 2.9 percent to a rate of 680,000 from the 661,000 originally reported for the previous month.
Sector News
Despite the modest weakness being shown by the broader markets, oil service stocks continue to see significant strength, driving the Philadelphia Semiconductor Index up by 1.5 percent to a five-month intraday high.
The strength among oil service stocks comes amid a sharp increase by the price of crude oil, with crude for May delivery jumping $1.08 to $81.71 a barrel.
A notable increase by the price of gold is also contributing to considerable strength among gold stocks, as reflected by the 1.2 percent gain being posted by the NYSE Arca Gold Bugs Index.
Computer hardware, steel, and oil producer stocks are also seeing strength on the day, while software and transportation stocks have moved to the downside.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Monday. Japan's Nikkei 225 Index slumped by 1.2 percent, while China's Shanghai Composite Index slid by 0.7 percent.
Meanwhile, the major European markets turned in a mixed performance on the day. While the German DAX Index rose by 0.3 percent, the French CAC 40 Index closed just below the unchanged line and the U.K.'s FTSE 100 Index dipped by 0.2 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 2.7 basis points at 4.245 percent.
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