U.S. Stocks Turn In Lackluster Performance Following Yesterday's Rebound

(RTTNews) - Following the rebound seen over the course of Monday's session, stocks showed a lack of direction over the course of the trading day on Tuesday. The major averages spent most of the day bouncing back and forth across the unchanged line.

The major averages eventually ended the day mixed. While the Nasdaq inched up 8.28 points or 0.1 percent to 13,505.87, the S&P 500 fell 12.22 points or 0.3 percent to 4,387.55 and the Dow slid 174.86 points or 0.5 percent to 34,288.83.

The lackluster performance on Wall Street came as traders continued to look ahead to the economic symposium in Jackson Hole, Wyoming, later this week.

The symposium will feature meetings by global central bank leaders as well as a speech by Federal Reserve Chair Jerome Powell that could impact the outlook for interest rates.

Early volatility in the bond market may also have contributed to the choppy trading, with the yield on the benchmark ten-year note showing wild swings back and forth across the unchanged line before eventually closing modestly lower.

Concerns about the outlook for interest rates have contributed to a recent surge in bond yields, driving the ten-year yield to its highest levels in over fifteen years.

On the U.S. economic front, the National Association of Realtors released a report showing existing home sales in the U.S. slumped by much more than expected in the month of July.

NAR said existing home sales tumbled by 2.2 percent to an annual rate of 4.07 million in July after plunging by 3.3 percent to an annual rate of 4.16 million in June. Economists had expected existing home sales to edge down to an annual rate of 4.15 million.

Existing home sales decreased for the fourth time in the past five months, falling to their lowest annual rate since hitting 4.00 million in January.

Sector News

While most of the major sectors showed only modest moves on the day, banking stocks moved sharply lower, dragging the KBW Bank Index down by 2.6 percent to its lowest closing level in almost two months.

The sell-off by banking stocks came after S&P Global Ratings downgraded several regional banks by one notch, citing "tough operating conditions."

Oil service stocks also saw considerable weakness amid a decrease by the price of crude oil, resulting in a 1.3 percent drop by the Philadelphia Oil Service Index.

Brokerage, semiconductor and natural gas stocks also moved to the downside, while some strength was visible among gold and steel stocks.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Tuesday. Japan's Nikkei 225 Index and China's Shanghai Composite Index both advanced by 0.9 percent, while Hong Kong's Hang Seng Index jumped by 1.0 percent.

The major European markets also moved to the upside on the day. While the U.K.'s FTSE 100 Index edged up by 0.2 percent, the French CAC 40 Index and the German DAX Index climbed by 0.6 percent and 0.7 percent, respectively.

In the bond market, treasuries finished the day modestly higher after seeing considerable volatility early in the session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, slipped 1.4 basis points to 4.328 percent.

Looking Ahead

Trading activity is likely to remain light on Wednesday ahead of the Jackson Hole summit, although a report on new home sales may attract some attention.