RTTNews - After a negative start, stocks have been able to offset some of their losses and are turning in a mixed performance in mid-afternoon trading on Friday. The Dow and the S&P 500 are little changed while the tech heavy Nasdaq remains down by a notable margin.
Earlier, traders reacted to disappointing quarterly figures from Microsoft (MSFT), while American Express (AXP), Amazon.com (AMZN), Black & Decker (BDK), Schlumberger (SLB) and others offered a mixed bag of results.
Traders largely shrugged off a mixed report from Reuters and the University of Michigan, which showed that their reading on consumer sentiment for the month of July was upwardly revised from the preliminary reading but still came in well below the previous month.
Meanwhile, Treasury Secretary Timothy Geithner and Federal Reserve Chairman Ben Bernanke are among government officials testifying before the House Financial Services Committee regarding financial service regulatory reform.
The major averages have seen choppy movement in recent trading, reflecting the lackluster performance by the broader markets. While the Nasdaq is currently down 13.94 at 1,959.66, the Dow is down 0.68 at 9,068.61 and the S&P 500 is down 0.31 at 975.98.
The Dow components are largely split, contributing to lack of direction being shown by the blue chip index.
Two of the Dow's strongest performers are Alcoa (AA) and Merck (MRK), which are rising by 1.5 percent and 2.2 percent, respectively. Alcoa has extended its gains, rising to its best intra-day price in well over five months, while Merck remains stuck in a one-month trading range.
Pfizer (PFE), Johnson & Johnson (JNJ) and Caterpillar (CAT) are among the other Dow components advancing by notable margins, poised to finish at fresh multi-month highs. Further, shares of Travelers (TRV) are also climbing, on pace for their best finish in six weeks' time.
The blue chip index is being limited by shares of Microsoft, which are plunging by 8.8 percent. The loss comes after the company reported weaker than expected quarterly sales. The drop has dragged the stock well off its best closing level in over nine months.
Also posting considerable losses are shares of United Technologies (UTX), which are down by 2.6 percent, and Kraft Foods (KFT), which is sliding by 1.3 percent. United Technologies remains stuck in a range, while Kraft is pulling back off of its highest closing price in well over five months.
Airline stocks are turning in some of the day's strongest performances, with the NYSE Arca Airline Index rising by 3.4 percent. The day's gain has lifted the index to its best intraday level in well over five months.
The index is being helped by shares of US Airways (LCC), which have soared by 17.8 percent. The upward move comes after the airline reported a second quarter profit including one-time benefits. The stock has been boosted to its best intraday level in just over one month's time.
Biotechnology and healthcare providers stocks are also moving higher, with the NYSE Arca Biotechnology Index and the Morgan Stanley Healthcare Provider Index both posting 1.7 percent gains.
Despite some sectors erasing earlier losses, tech stocks remain stuck in the red. Semiconductor, computer technology and software stocks continue to see notable weakness.
Banking and railroad stock are also turning in disappointing performances, with the S&P Banks Index and the Dow Jones Railroads Index falling by 1.4 percent and 1.2 percent, respectively. The railroads index is pulling back off an eight-month closing high.
In Focus: Consumer Sentiment, Earnings News
As mentioned above, Reuters and the University of Michigan said the consumer sentiment index for July came in at 66.0 compared to the preliminary reading of 64.6, although it remains below a reading of 70.8 for June. Economists had expected the index to be revised up to 65.0.
Meanwhile, Microsoft Corp. reported fourth quarter net income of $0.34 per share, compared to $0.46 per share in the same quarter of last year. The software giant said revenue for the quarter fell 17 percent to $13.1 billion, coming in below analyst estimates of $14.37 billion.
American Express reported adjusted second quarter net income of $0.27, edging out Wall Street expectations of $0.26 per share. At the same time, revenues for the quarter fell short of analyst estimates.
Separately, Amazon.com said that its net income for the second quarter fell to $0.32 per share from $0.37 per share in the year-ago quarter. The results came in-line with analyst forecasts, and although revenues rose by 14 percent, the quarterly sales failed to meet estimates.
In overseas trading, stock markets across the Asia-Pacific region finished on the upside on Friday. While Japan's benchmark Nikkei 225 Index posted a 1.6 percent gain, Hong Kong's Hang Seng Index rose by 0.8 percent.
Meanwhile, the major European markets closed on a mixed note, with the German DAX Index and the French CAC 40 Index finishing down by 0.4 percent and 0.2 percent, respectively, while the U.K.'s FTSE 100 Index rose by 0.4 percent.
In the bond markets, treasuries continue to see modest strength. Subsequently, the yield on the benchmark ten-year note is trading at 3.67 percent, posting a loss of 3.3 basis points on the day.
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