After an initial uptick, stocks have moved sharply lower over the course of morning trading on Tuesday. The major averages have slid firmly into negative territory, extending the notable downward move seen over the two previous sessions.
Currently, the major averages are just off their highs of the session. The Dow is down 355.97 points or 1.1 percent at 31,743.02, the Nasdaq is down 172.16 points or 1.4 percent at 11,845.51 and the S&P 500 is down 53.41 points or 1.3 percent at 3,977.20.
Bargain hunting contributed to initial strength on Wall Street, but buying interest waned shortly after the start of trading.
The subsequent sell-off by stocks reflects lingering concerns about the outlook for interest rates and the impact further rate hikes will have on the economy.
Stocks have been under pressure since Federal Reserve Chair Jerome Powell indicated the central bank plans to continue aggressively raising interest rates during a speech last Friday.
Powell suggested that even after the Fed finishes tightening monetary policy, rates will remain at higher levels to ensure inflation remains contained.
Meanwhile, traders have shrugged off a report from the Conference Board showing consumer confidence rebounded by more than expected in the month of August.
The Conference Board said its consumer confidence index jumped to 103.2 in August from a downwardly revised 95.3 in July.
Economists had expected the consumer confidence index to climb to 97.4 from the 95.7 originally reported for the previous month.
Energy stocks are pulling back sharply after bucking the downtrend in the previous session, with a steep drop by the price of crude oil weighing on the sector.
Crude for October delivery is currently plunging $4.37 to $92.64 a barrel after spiking $3.95 to $97.01 a barrel on Monday.
Reflecting the weakness in the energy sector, the Philadelphia Oil Service Index is down by 5.6 percent, the NYSE Arca Oil Index is down by 4 percent and the NYSE Arca Natural Gas Index is down by 3.6 percent.
Substantial weakness is also visible among steel stocks, as reflected by the 4 percent nosedive by the NYSE Arca Steel Index.
Gold, semiconductor and transportation stocks are also seeing considerable weakness, moving lower along with most of the other major sectors.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Tuesday. Japan’s Nikkei 225 Index jumped by 1.1 percent, while China’s Shanghai Composite Index fell by 0.4 percent.
The major European markets have also turned mixed on the day. While the German DAX Index is up by 0.2 percent, the French CAC 40 Index is down by 0.5 percent and the U.K.’s FTSE 100 Index is down by 0.7 percent.
In the bond market, treasuries are extending the wild ride seen over the course of the previous session. The yield on the benchmark ten-year note, which moves opposite of its price, is currently up by 3.4 basis points at 3.144 percent.
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