Tomahawk, WI 10/5/2011 (PennyPayDay) – Stocks are turning in a lackluster performance in early trading on Wednesday, as traders expressed continued uncertainty about the global economic outlook. The major averages have been bouncing back and forth across the unchanged line.
Currently, the major averages are all in negative territory, posting modest losses. The Dow is down 5.82 points or 0.1 percent at 10,802.89, the Nasdaq is down 7.61 points or 0.3 percent at 2,397.21 and the S&P 500 is down 0.58 points or 0.1 percent at 1,123.37.
The choppy trading comes despite the release of a report from payroll processor ADP showing stronger than expected private sector job growth in the month of September.
ADP said that private sector employment rose by 91,000 jobs in September following a downwardly revised increase of 89,000 jobs in August. Economists had expected employment to increase by about 75,000 jobs compared to the addition of 91,000 jobs originally reported for the previous month.
However, Peter Boockvar, equity strategist at Miller Tabak, said, "While it's great to see job gains more than estimated, the total amount still doesn't compare favorably to the average job gains of 144,000 in the first eight months of the year prior."
The markets have also not shown much reaction to a report from the Institute for Supply Management showing a continued expansion in service sector activity in the month of September.
While the ISM said its index of activity in the service sector slipped to 53.0 in September from 53.3 in August, a reading above 50 indicates continued growth in the sector. Economists had expected the index to dip to a reading of 52.9.
Despite the lackluster performance by the broader markets, commercial real estate stocks have shown a notable move to the downside, dragging the Morgan Stanley REIT Index down by 1.8 percent. The index is partly offsetting the strong gain posted in the previous session.
Early weakness is also visible among oil service and utilities, while considerable strength has emerged among gold, networking, and transportation stocks.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Wednesday. While Japan's Nikkei 225 Index fell by 0.9 percent, Australia's All Ordinaries Index advanced by 1.5 percent.
Meanwhile, the major European markets are all seeing considerable strength on the day. The U.K.'s FTSE 100 Index is surging up by 2.4 percent, while the French CAC 40 Index and the German DAX Index are jumping by 3.1 percent and 3.8 percent, respectively.