Slew Of Economic Data Leads To Mixed Close On Wall Street - U.S. Commentary

(RTTNews) - Stocks turned in a relatively lackluster performance during trading on Tuesday following the release of a mixed batch of U.S. economic data. Despite the choppy trading, the Dow closed above 18,000 for the first time and set a new record closing high along with the S&P 500.

The major averages ended the day on opposite sides of the unchanged line. While the Nasdaq fell 16.00 points or 0.3 percent to 4,765.42, the Dow climbed 64.73 points or 0.4 percent to 18,024.17 and the S&P 500 edged up 3.63 points or 0.2 percent to 2,082.17.

Early buying interest was generated by a report from the Commerce Department showing much stronger than previously estimated third quarter GDP growth.

The report said the final reading on third quarter GDP showed a 5.0 percent increase compared to the previously estimated 3.9 percent growth. Economists had expected the pace of GDP growth to be upwardly revised to 4.3 percent.

The stronger than expected growth reflected upward revisions to consumer spending, non-residential fixed investment and private inventory investment.

However, the Commerce Department also released separate reports showing unexpected decreases in durable goods orders and new home sales.

Durable goods orders fell by 0.7 percent in November compared to expectations for a 3.0 percent jump, while new home sales tumbled by 1.6 percent in November versus estimates for a modest increase.

Relatively light trading activity also contributed to the lackluster performance, as some traders got a head start on the holidays.

Among individual stocks, shares of Chesapeake Energy (CHK) moved sharply higher after the energy producer announced a $1 billion common stock repurchase program as well as the completion of a $5 billion asset sale.

Drugstore chain Walgreen (WAG) also turned in a strong performance after reporting adjusted first quarter earnings and revenues that exceeded analyst estimates.

Meanwhile, shares of Keurig Green Mountain (GMCR) came under pressure on news the company is recalling 6.6 million of its Mini Plus Brewing Systems because of reported burns.

Sector News

While many of the major sectors ended the day showing only modest moves, significant strength was visible among energy stocks. The strength in the sector came amid a notable increase by the price of crude oil, with crude for February delivery climbing $1.86 to $57.12 a barrel.

Reflecting the strength in the energy sector, the NYSE Arca Oil & Gas Index and the NYSE Arca Natural Gas Index advanced by 1.4 percent and 1.3 percent, respectively.

Brokerage stocks also turned in a strong performance on the day, resulting in a 1.2 percent gain by the NYSE Arca Broker/Dealer Index. With the gain, the index reached its best closing level in over six years.

Banking, steel, and software stocks also saw notable strength, with the Dow Jones Software Index reaching a fourteen-year high.

On the other hand, biotechnology stocks saw substantial weakness, resulting in a 4.4 percent drop by the NYSE Arca Biotechnology Index. The loss pulled the index down further off the record closing high it set last Friday.

Healthcare and pharmaceutical stocks also came under pressure on the day, partly offsetting the strength seen in the aforementioned sectors.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower on Tuesday, although the Japanese markets were closed for a holiday. China's Shanghai Composite Index plummeted by 3 percent, while Hong Kong's Hang Seng Index fell by 0.3 percent.

Meanwhile, the major European markets all moved to the upside on the day. While the French CAC 40 Index surged up by 1.4 percent, the German DAX Index advanced by 0.6 percent and the U.K.'s FTSE 100 Index rose by 0.3 percent.

In the bond market, treasuries moved sharply lower following the GDP data and a disappointing five-year note auction. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, jumped 9.5 basis points to 2.257 percent.

Looking Ahead

Trading on Wednesday could be impacted by the Labor Department's weekly jobless claims report, although activity is likely to be subdued amid an abbreviated Christmas Eve session.