Major Averages Pull Back Off Highs But Remain Positive

After an early move to the upside, stocks have given back ground over the course of morning trading on Wednesday. The major averages have pulled back well off their highs of the session.

Currently, the major averages remain in positive territory. The Dow is up 12.40 points or 0.1 percent at 22,296.72, the Nasdaq is up 35.68 points or 0.6 percent at 6,415.85 and the S&P 500 is up 2.88 points or 0.1 percent at 2,499.72.

The initial strength on Wall Street was partly in reaction to a report from the Commerce Department showing a bigger than expected jump in durable goods orders in the month of August.

The report said durable goods orders surged up by 1.7 percent in August after plunging by 6.8 percent in July. Economists had expected orders to climb by 1.0 percent.

Excluding an increase in orders for transportation equipment, durable goods orders edged up by 0.2 percent in August after climbing by 0.8 percent in July. The uptick matched economist estimates.

The Commerce Department also said orders for non-defense capital goods excluding aircraft, an indicator of business spending, rose by 0.9 percent in August after climbing by 1.1 percent in July.

Michael Pearce, U.S. economist at Capital Economics said the data suggests that business equipment investment is set for another big gain in the third quarter.

However, buying interest was partly offset by the release of a separate report from the National Association of Realtors showing a steep drop in pending home sales in the month of August.

NAR said its pending home sales index plunged by 2.6 percent to 106.3 in August from 109.1 in July. The index had been expected to dip by 0.5 percent.

With the much bigger than expected decrease, the pending home sales index dropped to its lowest reading since hitting 106.1 in January of 2016.

A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.

Nonetheless, significant strength remains visible among electronic storage stocks, with the NYSE Arca Disk Drive Index jumping by 2.2 percent.

Micron Technology (MU) has led the storage sector higher after reporting better than expected fourth quarter results and providing upbeat guidance.

Financial, semiconductor, and internet stocks are also seeing notable strength, while commercial real estate and gold stocks have moved to the downside.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on…

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