Stocks Turn Mixed After Seeing Initial Strength - U.S. Commentary

(RTTNews) - Stocks moved higher at the start of trading on Monday, but buying interest waned shortly after the open. The major averages have subsequently pulled back off their highs for the young session, with the tech-heavy Nasdaq dipping into negative territory.

Currently, the major averages are turning in a mixed performance on the day. While the Nasdaq is down 6.76 points or 0.2 percent at 4,636.88, the Dow is up 36.44 points or 0.2 percent at 16,382.89 and the S&P 500 is up 0.86 points or less than a tenth of a percent at 1,922.89.

The initial strength on Wall Street was partly due to bargain hunting, as traders picked up stocks at reduced levels following recent weakness.

The steep drop seen in recent sessions pulled the major averages down to their lowest closing levels in three months last Friday.

Traders seemed reluctant to get back into the markets, however, with ongoing concerns about the global economy limited the upside.

The lack of major U.S. economic data due to be released on the day may also have made traders reluctant to make any significant moves.

The economic calendar is relatively quiet for much of the week, although several key reports are scheduled to be released on Friday.

Traders are likely to keep an eye on reports on retail sales, producer price inflation, industrial production, and consumer sentiment.

Aluminum giant Alcoa (AA) is also scheduled to release its fourth quarter results after the close of today's trading, marking the unofficial start of earnings season.

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

Nonetheless, significant weakness has emerged among biotechnology stocks, as reflected by the 2.1 percent loss being posted by the NYSE Arca Biotechnology Index. With the drop, the index has fallen to a two-month low.

Qiagen (QGEN) has helped to lead the biotech sector lower after the genetic testing specialist warned of weaker than expected full year results.

Gold, natural gas, and trucking stocks have also come under pressure, while strength is visible among tobacco and utilities stocks.

In overseas trading, stock markets across the Asia-Pacific region saw considerable weakness on Monday, although the Japanese markets were closed for a holiday. Hong Kong's Hang Seng Index slumped by 2.8 percent, while China's Shanghai Composite Index plunged by 5.3 percent.

Meanwhile, the major European markets have moved to the upside on the day. While the U.K.'s FTSE 100 Index is just above the unchanged line, the French CAC 40 Index and the German DAX Index are up by 0.6 percent and 0.9 percent, respectively.

In the bond market, treasuries are giving back some ground following recent strength. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 4.2 basis points at 2.172 percent.