RTTNews - Stocks moved sharply lower at the start of trading on Wednesday, with the major averages moving back to the downside after seeing some strength in the previous session. The initial weakness was partly in reaction to a sell-off in the Chinese markets.
Significant weakness has emerged in a variety of sectors, as traders cash in on the strong gains that were posted on Tuesday. Steel, commercial real estate, computer hardware, and housing stocks are turning in some of the worst performances.
Traders are also reacting negatively to the latest batch of earnings news, even though Hewlett-Packard (HPQ) and Analog Devices (ADI) reported better than expected quarterly earnings.
Hewlett-Packard reported third quarter earnings of $0.91 per share after the bell Tuesday, beating the consensus estimate of $0.90 per share. The company also said it expects to report fourth quarter earnings of $1.12 per share compared to the forecast of $1.07 per share.
Separately, Analog Devices reported third quarter earnings that fell to $0.22 per share from $0.47 per share in the year-ago quarter, although it still beat analyst estimates of $0.20 per share.
In other news, Ellen Hughes-Cromwick, chief economist of Ford (F), was quoted as saying that economic indicators are showing that a recovery is already underway and that auto sales seem to be stabilizing. Hughes-Cromwick also said that Ford would see an improvement in sales in 2010.
In recent trading, the major averages have bounced off their lows for the young session, although they remain firmly in the red. The Dow is currently down 59.17 at 9,158.77, the Nasdaq is down 16.52 at 1,939.40 and the S&P 500 is down 6.46 at 983.21.
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