U.S. Stocks Seeing Modest Weakness Ahead Of Fed Minutes

Following the Independence Day holiday on Tuesday, stocks are turning in a lackluster performance during trading on Wednesday. The major averages have regained ground after an initial move to the downside but are currently in negative territory.

The Dow is down 54.32 points or 0.2 percent at 34,364.15, the Nasdaq is down 15.61 points or 0.1 percent at 13,801.16 and the S&P 500 is down 3.66 points or 0.1 percent at 4,451.93.

The choppy trading on Wall Street comes as traders look ahead to the release of the minutes of the Federal Reserve’s latest monetary policy meeting this afternoon.

Traders are likely to closely examine the minutes for clues about the outlook for interest rates after the Fed paused its recent series of interest rate hikes in June.

While the Fed is still widely expected to raise interest rates by a quarter point later this month, traders are hopeful that will be end of the rate-hiking cycle.

In U.S. economic news, the Commerce Department released a report showing new orders for U.S. manufactured goods increased by much less than expected in the month of May

The Commerce Department said factory orders rose by 0.3 percent in May after rising by a downwardly revised 0.3 percent in April.

Economists had expected factory orders to climb by 0.8 percent compared to the 0.4 percent increase originally reported for the previous month.

Chemical stocks have shown a significant move to the downside on the day, dragging the S&P Chemical Sector Index down by 1.9 percent. The index is pulling back off its best closing level in nearly four months.

Significant weakness is also visible among steel stocks, as reflected by the 1.9 percent slump by the NYSE Arca Steel Index.

Gold, semiconductor and housing stocks are also seeing considerable weakness, while utilities stocks have moved notably higher.

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Wednesday. Japan’s Nikkei 225 Index slipped by 0.3 percent, while China’s Shanghai Composite Index slid by 0.7 percent.

The major European markets have also moved to the downside on the day. While the U.K.’s FTSE 100 Index has slumped by 1.0 percent, the French CAC 40 Index is down by 0.8 percent and the German DAX Index is down by 0.7 percent.

In the bond market, treasuries are extending the downward move seen over the course of Monday’s session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 4.2 basis points at 3.900 percent.

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