Market Commentary and Intraday News

Major Averages Stuck Firmly In Negative Territory

266 days ago

(RTTNews) - After moving notably lower over the course of morning trading on Thursday, stocks continue to see significant weakness in the mid-afternoon. The major averages remain stuck firmly in negative territory, more than offsetting yesterday's modest gains.

Caution ahead of Federal Reserve Chairman Ben Bernanke's speech to the Kansas City Fed's Jackson Hole symposium on Friday has contributed to the weakness on Wall Street, with some traders looking for safe havens ahead of the Fed chief's remarks.

Further selling pressure was generated by a report from Bloomberg News indicating that Spanish Prime Minister Mariano Rajoy said his government will delay deciding whether to seek a sovereign bailout until the aid conditions are clear.

Traders are also digesting the latest batch of U.S. economic data, including a report from the Labor Department showing that jobless claims unexpectedly came in unchanged in the week ended August 25th.

Networking stocks continue to see substantial weakness, with the NYSE Arca Networking Index down by 3.3 percent. Ciena (CIEN) is leading the sector lower after reporting a wider than expected third quarter loss and providing disappointing guidance. Shares of Ciena have tumbled by 18.7 percent on the news.

Considerable weakness also remains visible among electronic storage stocks, as reflected by the 2.8 percent loss being posted by the NYSE Arca Disk Drive Index. Seagate Technology (STX) and Western Digital (WDC) are turning in two of the sector's worst performances.

Steel, oil service, computer hardware, and telecom stocks are also posting steep losses, moving lower along with most of the major sectors.

The major averages have moved roughly sideways in recent trading, lingering near their worst levels of the day. The Dow is down 99.55 points or 0.8 percent at 13,007.93, the Nasdaq is down 30.29 points or 1 percent at 3,050.90 and the S&P 500 is down 10.26 points or 0.7 percent at 1,400.23.

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