After moving modestly lower over the two previous sessions, stocks showed a lack of direction throughout the trading day on Tuesday. The major averages spent the day bouncing back and forth across the unchanged line.

The major averages eventually ended the session modestly higher. The Dow edged up 39.03 points or 0.2 percent to 20,689.24, the Nasdaq inched up 3.93 points or 0.1 percent to 5,898.61 and the S&P 500 inched up 1.32 points or 0.1 percent to 2,360.16.

The choppy trading on Wall Street came as traders seemed reluctant to make significant moves ahead of some key events later this week, including the release of the closely watched monthly jobs report on Friday.

Traders are also likely to keep a close eye on the release of the minutes of the latest Federal Reserve meeting on Wednesday, looking for clues about the outlook for interest rates.

Additionally, President Donald Trump and Chinese President Xi Jinping are scheduled to hold their first meeting later this week.

In economic news, the Commerce Department released a report showing that the U.S. trade deficit narrowed by more than expected in the month of February.

The Commerce Department said the trade deficit narrowed to $43.6 billion in February from a revised $48.2 billion in January.

Economists had expected the deficit to narrow to $44.8 billion from the $48.5 billion originally reported for the previous month.

The narrower trade deficit came as the value of exports edged up by 0.2 percent to $192.9 billion, while the value of imports tumbled by 1.8 percent to $236.4 billion.

A separate report from the Commerce Department showed a continued increase in factory orders in the month of February.

The Commerce Department said factory orders jumped by 1.0 percent in February after surging up by a revised 1.5 percent in January. The increase in orders matched economist estimates.

Sector News

Most of the major sectors ended the day showing only modest moves, contributing to the lackluster close by the broader markets.

Natural gas stocks saw substantial strength, however, with the NYSE Arca Natural Gas Index surging up by 2.2 percent. With the jump, the index reached its best closing level in well over a month.

The strength among natural gas stocks came amid a sharp increase in the price of the commodity, as natural gas for May delivery climbed $0.165 to $3.293 per million BTUs.

Considerable strength was also visible among railroad stocks, as reflected by the 1.5 percent gain posted by the Dow Jones Railroads Index. Union Pacific (UNP), Norfolk Southern (NSC), and CSX (CSX) posted notable gains.

Steel and gold stocks also showed strong moves to the upside, while airline stocks came under significant selling pressure on the day.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Tuesday. Japan’s Nikkei 225 Index fell by 0.9 percent, while Australia’s All Ordinaries Index edged down by 0.2 percent. Markets in China remained closed on the day.

Meanwhile, the major European markets moved to the upside on the day. While the U.K.’s FTSE 100 Index climbed by 0.5 percent, the French CAC 40 Index and the German DAX Index rose by 0.3 percent and 0.2 percent, respectively.

In the bond market, treasuries ended the day roughly flat after seeing early strength. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, closed unchanged at 2.350 percent.

Looking Ahead

Trading on Wednesday may be impacted by reaction to ADP’s report on private sector employment in March, which could provide some clues about the Labor Department’s monthly jobs report.

The Institute for Supply Management’s report on service sector activity in March is also likely to attract attention along with the minutes of the latest Fed meeting.

by RTT Staff Writer

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