RTTNews - Stocks are extending their stay in negative territory in mid-afternoon trading on Monday, as some traders are taking profits following recent gains. The major averages are all in negative territory after moving higher in each of the four previous weeks.
The retreat comes as traders are looking ahead to key economic reports later in the week, including data on retail sales, industrial production and weekly jobless claims.
Further, the Federal Open Market Committee will make its interest rate announcement on Wednesday, with the key fed funds rate expected to remain unchanged amid a challenging economic environment.
The major averages have seen some further downside in recent trading, falling to new lows for the session. The Dow is currently down 78.44 at 9,291.63, the Nasdaq is down 20.60 at 1,979.65 and the S&P 500 is down 9.43 at 1,001.05.
A majority of the Dow components are in the red in mid-afternoon trading, contributing pullback being shown by the blue chip index.
One of the Dow's worst performers is Boeing (BA), which is posting a loss of 2.8 percent. With the loss, the stock has pulled back well off the six-week high set on Friday.
The loss by Boeing comes even though the company secured a $1.15 billion contract with the Canadian government for 15 new Chinook heavy-lift helicopters. The twin-engine choppers will be made at Boeing Rotorcraft Systems facility in Ridley Township, with deliveries expected to be made between year 2013 and 2014.
Additionally, shares of 3M (MMM) and Cisco (CSCO) are sliding by 3.3 percent and 3 percent, respectively. 3M is backing off of its best closing level in nearly a year, while Cisco is being dragged further off of its best closing price in ten months, set early last week.
Alcoa (AA), Travelers (TRV) and Caterpillar (CAT) are also retreating by substantial margins, while shares of Merck (MRK) are bucking the downtrend, posting gain of 2 percent.
McDonald's (MCD) is also on the rise after the company announced that its global comparable sales rose 4.3 percent in July, benefiting from a 7.2 percent jump in sales in Europe. The stock is up by 1.7 percent, bouncing further off the two -month closing low set last Thursday.
Johnson & Johnson (JNJ), Intel (INTC), Bank of America (BAC) are also rising, although by more modest margins
Retail stocks are moving sharply lower in mid-afternoon trading, with the S&P Retail Index posting a loss of 2.8 percent. With the slide, the index is pulling back off the ten-month closing high set on Friday.
The index is being hurt by shares of Ann Taylor (ANN), which are down by 7.8 percent, moving off of their highest closing price in over nine months.
Additionally, steel and gold stocks are extending their weakness, with the NYSE Arca Steel Index and the NYSE Arca Gold Bugs Index down by 3.8 percent and 2.9 percent, respectively.
Housing, airline, commercial real estate stocks are also retreating, while some electronic storage stocks continue to turn in strong performances. Shares of Hutchinson Technology (HTCH) have jumped 19.2 percent on the day and are poised to close at their best level in over nine months.
In Focus: Corporate News
Freddie Mac (FRE) said late Friday that it no longer needs government help at this point, as the mortgage lender posted a positive net worth.
Benefiting from accounting adjustments and gains, Freddie Mac reported a second quarter profit of $821 million on a notable increase in revenues to $7.47 billion from last year's $1.59 billion.
Warren Buffett-owned Berkshire Hathaway (BRKA) reported a 14 percent increase in second quarter earnings, fueled by gains from derivatives trading, which soared to $1.53 billion from $453 million in the second quarter of last year. The firm earned $1,147 per share, while Wall Street analysts expected the company to earn $1,238 per share for the quarter.
Microsoft (MSFT), which recently struck a ten-year deal with Yahoo (YHOO) to share search engine technology and ad revenue, announced an agreement with French ad company Publicis to sell its Razorfish digital advertising unit.
In overseas trading, stock markets across the Asia-Pacific region largely turned in strong performances on Monday. Japan's benchmark Nikkei 225 Index rose by 1.1 percent, reaching a ten-month high, while Hong Kong's Hang Seng Index surged up by 2.7 percent.
Meanwhile, the major European markets turned in a mixed performance, with the French CAC 40 Index and the German DAX Index closing down by 0.5 percent and 0.8 percent, respectively, while the U.K.'s FTSE 100 Index rose by 0.7 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 3.773 percent, posting a loss of 8.1 basis points.
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