Major Averages Continue To Turn In Mixed Performance In Mid-Day Trading

Stocks continue to turn in a mixed performance in mid-day trading on Tuesday, with the Dow adding to yesterday’s strong gain but the tech-heavy Nasdaq extending the sharp pullback seen over the course of the previous session.

After spiking by more than 800 points on Monday, the Dow is currently up by 157.18 points or 0.5 percent at 29,315.15. Meanwhile, the Nasdaq is down 130.77 points or 1.1 percent at 11,583.01 and the S&P 500 is down 7.67 points or 0.2 percent at 3,542.83.

The mixed performance on Wall Street comes as traders continue to cycle out of tech stocks that benefited from the coronavirus pandemic and into cyclical stocks that struggled.

Stocks that benefited from the coronavirus-induced lockdowns such as Zoom (ZM) and Amazon (AMZN) are seeing further downside after falling sharply on Monday.

The shift comes as upbeat news about a coronavirus vaccine being developed by Pfizer (PFE) and BioNTech (BNTX) has generated optimism business may return to normal next year.

However, there could be more pain between now and then, as coronavirus cases in the U.S. continue to spike and have now topped 10 million.

Even the most optimistic projections suggest it will take months to distribute a vaccine, suggesting yesterday’s spike to record highs may have been overdone.

The Dow is benefiting from an advance by shares of Boeing (BA), which are up by 5.6 percent after a report from Reuters said the FAA is set to lift its grounding order on the aerospace giant’s 737 MAX as early as next week.

Traders are also keeping an eye on the latest developments in Washington, as President Donald Trump continues to refuse to concede to Joe Biden.

The Supreme Court may also be attracting attention, as Justices hear arguments in case about Obamacare that could lead to the entire healthcare reform law being struck down.

Sector News

Tobacco stocks continue to see substantial strength in mid-day trading, with the NYSE Arca Tobacco Index surging up by 3.7 percent. The index is currently on pace to end the session at a nine-month closing high.

Considerable strength also remains visible among housing stocks, as reflected by the 3.4 percent jump by the Philadelphia Housing Sector Index.

Homebuilder D.R. Horton (DHI) has moved sharply higher after reporting better than expected fourth quarter results, raising its dividend and providing upbeat guidance.

Natural gas stocks have also showing a significant move to the upside on the day, driving the NYSE Arca Natural Gas Index up by 2.6 percent.

On the other hand, software stocks continue to see substantial weakness in mid-day trading, resulting in a 3.3 percent nosedive by the Dow Jones U.S. Software Index.

CyberArk Software (CYBR) is under pressure after reporting third quarter earnings that beat estimates but on weaker than expected revenue. The cybersecurity company also forecast fourth quarter revenue below expectations.

Gold stocks are also extending yesterday’s sell-off despite a rebound by the price of the precious metal, with the NYSE Arca Gold Bugs Index tumbling by 2.2 percent.

Significant weakness also remains visible among semiconductor stocks, as reflected by the 1.3 percent slump by the Philadelphia Semiconductor Index.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Tuesday. Japan’s Nikkei 225 Index rose by 0.3 percent, while Hong Kong’s Hang Seng Index surged up by 1.1 percent.

The major European markets also moved to the upside on the day. While the German DAX Index has climbed by 0.5 percent, the French CAC 40 Index and the U.K.’s FTSE 100 Index spiked by 1.6 percent and 1.8 percent, respectively.

In the bond market, treasuries are showing a lack of direction following the steep drop seen in the previous session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by less than a basis point at 0.953 percent.

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