Mid-day Market Update

Oxford, MS 9/9/2011 (PennyPayDay) – Stocks have moved sharply lower in early trading on Friday, succumbing to broad based selling pressure. The major averages have fallen firmly into negative territory, extending the notable downward moves seen over the course of the previous session.

Currently, the major averages are posting steep losses, just off their lows for the young session. The Dow is down 200.52 points or 1.8 percent at 11,095.29, the Nasdaq is down 30.06 points or 1.2 percent at 2,499.08 and the S&P 500 is down 16.25 points or 1.4 percent at 1,169.65.

The early sell-off on Wall Street comes as traders express skepticism about the economic impact of the proposals that President Barack Obama outlined in his highly anticipated jobs speech before a joint session of Congress Thursday evening.

Obama outlined a $447 billion package of tax cuts and new spending that includes a reduction in payroll taxes for both workers and small businesses, an extension of unemployment benefits, and an increase in spending on infrastructure projects.

Republican reaction to the remarks has been lukewarm at best, with some lawmakers criticizing Obama for rehashing old ideas that have not stimulated the economy.

Steel stocks are seeing considerable weakness amid concerns about the outlook for demand, with the NYSE Arca Steel Index sliding by 3.1 percent. Arcelor Mittal (MT) and Mechel (MTL) are turning in two of the sector's worst performances.

Notable weakness has also emerged among housing stocks, as reflected by the 2.2 percent loss being posted by the Philadelphia Housing Sector Index. Banking, energy, and utilities stocks are also under significant selling pressure, moving lower along with most of the major sectors.

Meanwhile, airline stocks are bucking the downtrend by the broader markets, resulting in a 1 percent gain by the NYSE Arca Airline Index. United Continental (UAL) is leading the sector higher despite reporting a 2.7 percent drop in August traffic.

Among individual stocks, shares of Texas Instruments (TXN) is trading higher even though the chip maker lowered its third quarter earnings and revenue guidance, citing broadly lower demand across a wide range of products, markets and customers.

Texas Instruments said it now expects earnings of $0.56 to $0.60 per share on revenues of $3.23 to $3.37 billion. The company previously forecast earnings of $0.55 to $0.65 per share on revenues of $3.40 to $3.70 billion.

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Friday. Japan's Nikkei 225 Index fell by 0.6 percent, while Hong Kong's Hang Seng Index edged down by 0.2 percent.

The major European markets are also moving to the downside on the day. While the U.K.'s FTSE 100 Index is down by 2.2 percent, the French CAC 40 Index and the German DAX Index are both down by 3.2 percent.

In the bond market, treasuries are seeing modest strength amid the weakness on Wall Street. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 2.6 basis points at 1.96 percent.

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