RTTNews - After opening lower, stocks continue to linger in negative territory in early afternoon trading on Wednesday. The major averages are all below the unchanged by moderate margins, with choppy trading visible throughout the first half of the session.

On the economic front, the Commerce Department released a report showing that orders for transportation equipment declined sharply in June, contributing to a substantial decline in orders for manufactured durable goods. Excluding the drop in transportation orders, the headline figure actually rose for the month.

Traders are also digesting earnings from Time Warner (TWX), Qwest (Q) and ConocoPhillips (COP), which reported earnings that largely beat Wall Street estimates. Revenues, however, fell short, a typical trend that has emerged amid the current earnings season.

Later today, the Federal Reserve is due to release its Beige Book, a compilation of reports on economic conditions from each of the 12 Federal Reserve districts. The report is due to be released at 2 p.m. ET.

The major averages have moved roughly sideways in recent trading, remaining stuck firmly in negative territory. The Dow is currently down 39.75 at 9,056.97, the Nasdaq is down 10.39 at 1,965.12 and the S&P 500 is down 5.93 at 973.69.

Sector News

Resource stocks continue to posted notable losses for the second straight session, with weakness visible among steel, oil service, natural gas and gold stocks. The move comes as commodities prices are also falling for another session.

Weakness is also visible in the tech sector, with electronic storage and semiconductor stocks retreating by considerable margins. Notably the NYSE Arca Disk Drive Index is posting a loss of 1.5 percent, backing off of its best closing level in nearly then months.

Further, the Philadelphia Semiconductor Index is dipping by 1 percent after hovering near the nearly ten-ten month highs set last week. The index is being pulled lower by Teradyne (TER) and Marvell Technology (MRVL), which are down by 4.2 percent and 2.2 percent, respectively.

While housing, railroad and internet stocks are also under pressure, healthcare stocks continue to see strong gains. Banking and airline stocks are also rising, although by more modest margins.

Stocks In The News

Meredith Corp. (MDP) is plunging in early afternoon trading after the firm reported a fourth quarter loss compared to a year ago profit. The company's full year guidance also came in below estimates. Meredith stock is falling by 12.3 percent, backing off of its best closing level in nearly ten months.

Royal Caribbean Cruises (RCL) is also moving to the downside after the company reported a wider than expected second quarter loss. Shares are currently down by 13.4 percent, backing further off the more than two-month closing high set late last week.

Meanwhile, shares of Conseco (CNO) are rising after the firm forecast a second quarter profit of $0.22 per share, in-line with Wall Street consensus. Shares of the diversified insurer are advancing by 47.4 percent, reaching their best intraday level in two months' time.

In Focus: Economic, Earnings News

As mentioned above, the Commerce Department report showed that durable goods orders fell 2.5 percent in June following a downwardly revised 1.3 percent increase in May. Economists had expected orders to fall 0.6 percent compared to the 1.8 percent increase originally reported for the previous month.

Excluding a 12.8 percent decrease in orders for transportation equipment, orders for durable goods actually rose 1.1 percent in June compared to a 0.8 percent increase in May. The increase surprised economists, who had expected ex-transportation orders to come in unchanged.

In earnings news, Time Warner reported adjusted second quarter net income of $0.45 per share, compared to $0.47 per share in last year's second quarter. While the earnings beat analyst estimates of $0.37 per share, revenues of $6.81 billion fell short of the expected $6.97 billion.

Meanwhile, Sprint Nextel (S) reported a second-quarter net loss of $0.13 per share compared to a loss of $0.12 per share in the same quarter last year. The telecom company also said its revenue fell 10 percent to $8.14 billion amid a decrease in subscribers.

Energy firm ConocoPhillips reported second-quarter earnings of $0.87 per share, compared with net income of $3.50 per share in the same quarter last year. While the results beat analyst estimates of $0.85 per share, revenues fell well short.

In other news, Yahoo! (YHOO) and Microsoft (MSFT) have signed an agreement whereby Microsoft would now power Yahoo search while Yahoo will become the exclusive worldwide relationship sales force for both companies' premium search advertisers. The deal is expected to close sometime in 2010 and has a lifespan of 10 years.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region finished largely on the downside on Wednesday. Hong Kong's Hang Seng Index slid by 2.4 percent, although Japan's benchmark Nikkei 225 Index bucked the downtrend and closed up by 0.3 percent.

Meanwhile, the major European markets closed notably higher, with the German DAX Index and the French CAC 40 Index finishing up by 1.9 percent and 1 percent, respectively, while the U.K.'s FTSE 100 Index rose by 0.4 percent.

In the bond markets, treasuries are seeing notable strength amid the pullback on Wall Street. Subsequently, the yield on the benchmark ten-year note is trading at 3.646 percent, posting a loss of 4.2 basis points on the day.

For comments and feedback: contact editorial@rttnews.com