U.S. Stocks Turning In Lackluster Performance Following Recent Sell-Off

Stocks moved sharply lower over the two previous sessions but are turning in a relatively lackluster performance during trading on Tuesday. While the Dow has remained positive after an early advance, the Nasdaq and the S&P 500 have been bouncing back and forth across the unchanged line.

Currently, the major averages are narrowly mixed. While the Dow is up 70.18 points or 0.2 percent at 37,805.29, the Nasdaq is down 11.88 points or 0.1 percent at 15,873.14 and the S&P 500 is down 9.98 points or 0.2 percent at 5,051.84.

The modest gain by the Dow comes amid a surge by shares of UnitedHealth (UNH), with the health insurance giant spiking by 1.8 percent.

UnitedHealth is rallying after reporting first quarter results that exceeded analyst estimates on both the top and bottom lines.

On the other hand, a 2.0 percent slump by shares of Johnson & Johnson (JNJ) is weighing on the Dow even though the healthcare giant reported first quarter earnings that beat expectations.

The lack of direction being shown by the broader markets comes as traders weigh the idea of picking up stocks at relatively reduced levels against concerns about the outlook for interest rates.

Adding to rate worries, the yield on the benchmark ten-year note reached its highest intraday levels in almost six months after the Federal Reserve released a report showing a continued increase in U.S. industrial production in the month of March.

The Fed said industrial production climbed by 0.4 percent in March, matching the upwardly revised advance in February as well as economist estimates.

Traders may also be reluctant to make significant moves ahead of remarks by Fed Chair Jerome Powell this afternoon, although the central bank’s comments are slated to focus on the Canadian economy.

Sector News

Airline stocks have shown a substantial move to the downside on the day, dragging the NYSE Arca Airline Index down by 2.3 percent to its lowest intraday level in almost three months.

Significant weakness is also visible among housing stocks, as reflected by the 1.8 percent loss being posted by the Philadelphia Housing Sector Index.

The index has fallen to a nearly two-month intraday low following the release of a Commerce Department report showing a sharp pullback in housing starts in the month of March.

Banking stocks are also seeing considerable weakness, with the KBW Bank Index falling by 1.7 percent to its lowest intraday level in well over a month.

Utilities, steel and commercial real estate stocks have also moved to the downside on the day, while some strength is visible among biotechnology and semiconductor stocks.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved sharply lower during trading on Tuesday. Japan’s Nikkei 225 Index dove by 1.9 percent, while Hong Kong’s Hang Seng Index plummeted by 2.1 percent.

The major European markets have also shown significant moves to the downside on the day. While the U.K.’s FTSE 100 Index has tumbled by 1.9 percent, the German DAX Index and the French CAC 40 Index are both down by 1.6 percent.

In the bond market, treasuries have climbed off their worst levels but continue to see modest weakness. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 1.9 basis points at 4.647 percent.