Stocks Showing A Lack Of Direction In Mid-Day Trading - U.S. Commentary

(RTTNews) - Following the substantial volatility seen in the previous session, stocks have shown a lack of direction over the course of the trading day on Friday. The major averages have spent the day bouncing back and forth across the unchanged line.

Currently, the major averages are turning in a mixed performance. While the Dow is down 31.57 points or 0.1 percent at 25,307.27, the Nasdaq is up 14.44 points or 0.2 percent at 7,287.52 and the S&P 500 is up 3.74 points or 0.1 percent at 2,741.50.

The choppy trading on Wall Street comes as traders seem reluctant to make more significant moves ahead of a highly anticipated meeting between President Donald Trump and Chinese President Xi Jinping.

Trump and Xi are due to hold a dinner meeting on Saturday on the sidelines of the G20 summit in Buenos Aires, Argentina.

Ahead of the meeting, Trump has offered mixed remarks about the likelihood the U.S. and China will reach an agreement to end the escalating trade dispute between the world's two largest economies.

"I think we're very close to doing something with China, but I don't know that I want to do it because what we have right now is billions and billions of dollars coming into the United States in the form of tariffs or taxes. So I really don't know," Trump said Thursday before departing for the summit.

"But I will tell you that I think China wants to make a deal. I'm open to making a deal," he added. "But, frankly, I like the deal we have right now."

In economic news, MNI Indicators released a report unexpectedly showing a substantial acceleration in the pace of growth in Chicago-area business activity in the month of November.

MNI Indicators said its Chicago business barometer spiked to 66.4 in November after falling to 58.4 in October, with a reading above 50 indicating growth in business activity. Economists had expected the index to edge down to 58.0.

The unexpected jump reflected increases across all five of the barometer's subcomponents, with resurgent orders, solid output and higher unfinished orders the month's key drivers.

Sector News

Most of the major sectors are showing only modest moves in mid-day trading, contributing to the lackluster performance by the broader markets.

Oil service stocks continue to see considerable weakness, however, with the Philadelphia Oil Service Index slumping by 1.3 percent.

The weakness among oil service comes amid a pullback by the price of crude oil, as crude for January delivery is falling $0.41 to $51.04 a barrel after jumping $1.16 to $51.45 a barrel on Thursday.

On the other hand, transportation stocks have shown a strong move to the upside, driving the Dow Jones Transportation Average up by 1.1 percent to its best intraday level in over a month.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Friday. Japan's Nikkei 225 Index rose by 0.4 percent, while Australia's S&P/ASX 200 Index tumbled by 1.6 percent.

Meanwhile, the major European markets all moved to the downside on the day. While the French CAC 40 Index edged down by 0.1 percent, the German DAX Index fell by 0.4 percent and the U.K.'s FTSE 100 Index slumped by 1 percent.

In the bond market, treasuries are seeing modest strength after ending the previous session slightly higher. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 1.4 basis points at 3.021 percent.
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