Nasdaq Posting Steep Loss Amid Weakness Among Tech Stocks - U.S. Commentary
After ending the previous session mostly higher, stocks are turning in a lackluster performance in morning trading on Wednesday. Significant weakness among technology stocks is contributing to a notable decline by the tech-heavy Nasdaq.
Currently, the major averages are all in negative territory, although the Dow is down just 0.76 points or less than a tenth of a percent at 25,970.30. The Nasdaq is down 75.05 points or 0.9 percent at 7,897.42 and the S&P 500 is down 6.50 points or 0.2 percent at 2,881.39.
Semiconductor stocks are turning in some of the market's worst performances on the day, resulting in a 3.2 percent plunged by the Philadelphia Semiconductor Index.
Micron Technology (MU) is leading the semiconductor sector lower after Goldman Sachs downgraded its rating on the chipmaker's stock to Neutral from Buy.
Considerable weakness is also visible among financial stocks, with the NYSE Arca Broker/Dealer Index and the KBW Bank Index sliding by 1.5 percent and 1.3 percent, respectively.
Telecom, computer hardware and networking stocks have also moved to the downside, while strength is visible among energy and gold stocks.
On the U.S. economic front, the Labor Department released a report unexpectedly showing a modest drop in producer prices in the month of August.
The Labor Department said its producer price index for final demand edged down by 0.1 percent in August after coming in unchanged in July. Economists had expected prices to rise by 0.2 percent.
Excluding food and energy prices, core producer prices still edged down by 0.1 percent in August following a 0.1 percent uptick in July. Core prices had been expected to increase by 0.2 percent.
Later in the day, trading may be impacted by reaction to the release of the Federal Reserve's Beige Book.
The Beige Book, a compilation of anecdotal evidence on economic conditions in the twelve Fed districts, may provide further clues about the outlook for interest rates.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Wednesday. Japan's Nikkei 225 Index and Hong Kong's Hang Seng Index both fell by 0.3 percent.
Meanwhile, the major European markets have moved to the upside on the day. While the French CAC 40 Index has climbed by 0.7 percent, the U.K.'s FTSE 100 Index is up by 0.4 percent and the German DAX Index is up by 0.1 percent.
In the bond market, treasuries are regaining ground after moving notably lower in the previous session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 1.8 basis points at 2.959 percent.
by RTTNews Staff Writer
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