RTTNews - After a modest pullback at the opening bell, stocks were able to recover and are lingering near the unchanged mark in mid-morning trading on Wednesday. The choppy trading comes as the response to another slew of earnings has been largely muted.
Earlier this morning, traders had a chance to react to quarterly results from big-name companies such as Apple (AAPL), Yahoo! (YHOO), Pfizer Inc. (PFE) Boeing (BA), Morgan Stanley (MS), Wells Fargo (WFC), and PepsiCo (PEP).
Reactions were mixed, however, as firms met or beat estimates by cost cutting rather than revenue growth and forecasts for the future were notably lower, reflecting the recessionary economic climate.
Meanwhile, Federal Reserve Chairman Ben Bernanke is redelivering his testimony regarding monetary policy, this time to the Senate Banking Committee.
Tuesday, Bernanke told House Financial Services Committee that the U.S. economy is showing signs of stabilization and stated that the stimulus authorities pumped into the global economy late last year probably helped to avoid a collapse of the financial system.
Bernanke also said that the Fed is prepared to remove its stimulus when the time is appropriate in order to avoid a spike in inflation. However, he reiterated that the economy is still in a fragile state, with unemployment high and consumer spending shaky.
The major averages are currently turning in a mixed performance, with the tech-heavy Nasdaq posting a modest gain. While the Nasdaq is currently up 1.92 at 1,918.12, the Dow is down 1.81 at 8,914.13 and the S&P 500 is down 1.46 at 953.12.
Despite the lack of direction being shown by the broader markets, electronic storage stocks are turning in strong performances in mid-morning dealing. The NYSE Arca Disk Drive Index is currently up 2.9 percent after reaching a nine-month intraday high earlier in the session.
Seagate Technology (STX) is helping to lead the sector higher, with the hard drive maker currently up 6.6 percent after reaching its best intraday level in over nine months. The gain by Seagate comes even though the company reported a fourth quarter loss.
Housing stocks are also moving higher, with the Philadelphia Housing Sector Index rising by 2.4 percent. The index has resumed its recent upward move and has reached its best intraday level in six weeks.
While semiconductor, transportation and health insurance stocks are also showing considerable moves to the upside, the day's gains are being offset by weakness among oil service and banking stocks.
Notably, the Philadelphia Oil Service Index and the Kbw Bank Index are sliding by 2.4 percent and 1.5 percent, respectively.
The losses by oil service stocks come amid a notable decrease by the price of oil, while bank stocks are moving lower amid a negative reaction to quarterly results from companies such as Morgan Stanley and Wells Fargo.
Stocks Driven By Analyst Comments
Sybase (SY) is rising in mid-morning trading after the stock was upgraded by Jefferies & Co. to Buy from Hold. The broker also raised its target price on the stock to $41 from $34. The stock is up by 3.2 percent, rising to its best intraday level in over ten months.
Shares of Kraft Foods (KFT) are also moving higher following an upgrade by Citigroup, which raised its rating on the stock to Buy from Hold. Additionally, the broker elevated its target price from $28 to $32. The stock is currently up by 1.4 percent, reaching its best intraday price in over five months.
On the other hand, shares of Northrop Grumman (NOC) are moving lower after J.P. Morgan downgraded its rating on the stock to Neutral from Overweight. Northrop Grumman is currently down 1.2 percent, pulling back further off the one-month closing high it set on Monday.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Wednesday. While Japan's benchmark Nikkei 225 Index posted a 0.7 percent gain, Hong Kong's Hang Seng Index fell by 1.3 percent.
The major European markets are also mixed, with the German DAX Index and the U.K.'s FTSE 100 Index up by 0.6 percent and 0.3 percent, respectively, while the French CAC 40 Index is lagging behind, posting a loss of 0.2 percent.
In the bond markets, treasuries are seeing modest weakness. Subsequently the yield on the benchmark ten-year note is trading at 3.513 percent, posting a gain of 3.6 basis points on the day.
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