U.S. Stocks Remain Mostly Lower In Afternoon Trading

Stocks came under pressure early in the session on Wednesday and are seeing continued weakness in afternoon trading. With the pullback on the day, the major averages are partly offsetting the strong gains posted in the previous session.

Currently, the major averages are off their worst levels of the day but still firmly negative. The Dow is down 265.42 points or 0.8 percent at 34,723.42, the Nasdaq is down 157.14 points or 1.1 percent at 13,982.62 and the S&P 500 is down 29.27 points or 0.7 percent at 4,441.80.

The pullback on Wall Street may partly reflect lingering concerns about ongoing tensions between Russia and Ukraine.

While Russian claims they are pulling some troops back from the Ukrainian border contributed to the rally on Tuesday, Western leaders have subsequently said they have not verified the moves.

Cyberattacks on the websites of Ukraine’s defense ministry as well as two major Ukrainian banks have also led to worries Russia could still be poised to invade.

A report from the Commerce Department showing a substantial rebound in U.S. retail sales in January may also have led to renewed concerns about the outlook for interest rates.

The Commerce Department said retail sales soared by 3.8 percent in January after plunging by a revised 2.5 percent in December.

Economists had expected retail sales to jump by 2.0 percent compared to the 1.9 percent slump originally reported for the previous month.

Excluding a sharp increase in motor vehicle and parts sales, retail sales still spiked by 3.3 percent in January following a 2.8 percent nosedive in December. Ex-auto sales were expected to increase by 0.8 percent.

The Labor Department also released a separate report showing U.S. import prices increased by much more than expected in the month of January.

The report said import prices surged up by 2.0 percent in January after falling by a revised 0.4 percent in December. The spike in import prices reflected the biggest monthly increase since April of 2011.

Economists had expected import prices to jump by 1.0 percent compared to the 0.2 percent dip originally reported for the previous month.

In other economic news, the Federal Reserve released a report showing production rebounded by much more than anticipated in the month of January.

The Fed said industrial production jumped by 1.4 percent in January after edging down by 0.1 percent in December. Economists had expected industrial production to rise by 0.4 percent.

Shortly, the Fed is due to release the minutes of its latest monetary policy meeting, which could shed additional light on the outlook for interest rates.

Sector News

Semiconductor stocks continue to see considerable weakness on the day, giving back ground after ending the previous session sharply higher. After spiking by 5.5 percent on Tuesday, the Philadelphia Semiconductor Index is down by 1.7 percent.

Significant weakness also remains visible among software stocks, as reflected by the 1.7 percent drop by the Dow Jones U.S. Software Index.

On the other hand, gold stocks have moved sharply higher over the course of the session, driving the NYSE Arca Gold Bugs Index up by 3.5 percent.

The rally by gold stocks comes amid an increase by the price of the precious metal, with gold for April delivery climbing $15.60 to $1,871.80 an ounce.

Energy stocks are also turning in a strong performance on the day, moving higher along with the price of crude oil.

With crude for March delivery jumping $2.04 to $94.11 a barrel, the Philadelphia Oil Service Index is up by 3.5 percent and the NYSE Arca Oil Index is up by 1.6 percent.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Wednesday. Japan’s Nikkei 225 Index shot up by 2.2 percent, while China’s Shanghai Composite Index climbed by 0.6 percent.

Meanwhile, the major European markets showed modest moves to the downside on the day. While the French CAC 40 Index dipped by 0.2 percent, the German DAX Index and the U.K.’s FTSE 100 Index both edged down by 0.1 percent.

In the bond market, treasuries have pulled back near the unchanged line after seeing early strength. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by less than a basis point at 2.0.43 percent after hitting a low of 2.007 percent.

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