After moving sharply lower early in the session, stocks have regained some ground over the course of the trading day on Friday. The major averages have climbed well off their worst levels of the day but remain firmly in negative territory.
Currently, the major averages appear stuck in the red. The Dow is down 157.73 points or 0.5 percent at 30,833.79, the Nasdaq is down 80.97 points or 0.6 percent at 13,031.67 and the S&P 500 is down 23.84 points or 0.6 percent at 3,771.70.
The early sell-off on Wall Street partly reflected a negative reaction to earnings news from financial giants Wells Fargo (WFC), Citigroup (C) and JPMorgan Chase (JPM).
Wells Fargo and Citigroup are posting steep losses after both reported better than expected fourth quarter earnings but on revenues that missed estimates.
Shares of JPMorgan have also moved notably lower even though the company reported fourth quarter results that beat expectations on both the top and bottom lines.
JPMorgan benefited from the release of money previously set aside for expected loan defaults, although its earnings would have still beat estimates with the boost.
Negative sentiment was also generated in reaction to a report from the Commerce Department showing a continued decline in U.S. retail sales in the month of December.
The Commerce Department said retail sales fell by 0.7 percent in December after tumbling by a revised 1.4 percent in November.
Economists had expected retail sales to come in unchanged compared to the 1.1 percent slump originally reported for the previous month.
Excluding sales by motor vehicle and parts dealers, retail sales plunged by 1.4 percent in December after sliding by 1.3 percent in November.
Ex-auto sales were expected to edge down by 0.1 percent compared to the 0.9 percent decrease originally reported for the previous month.
Meanwhile, the Federal Reserve released a separate report showing U.S. industrial production jumped by much more than expected in the month of December.
The Fed said industrial production surged up by 1.6 percent in December after climbing by an upwardly revised 0.5 percent in November.
Economists had expected production to rise by 0.4 percent, matching the increase originally reported for the previous month.
"The December production data underline that while new restrictions are holding back parts of the service sector again, the recovery in manufacturing continues largely unaffected," said Michael Pearce, Senior U.S. Economist at Capital Economics.
The weakness on Wall Street may also reflect the old adage of "sell the news" after President-elect Joe Biden announced a $1.9 trillion coronavirus relief package on Thursday.
The proposed stimulus package includes an increase in direct payments to individuals, increased federal unemployment benefits and aid to state and local governments.
Sector News
Steel stocks continue to see substantial weakness in mid-day trading, resulting in a 4.3 percent nosedive by the NYSE Arca Steel Index.
Considerable weakness also remains visible among energy stocks, which are pulling back along with the price of crude oil. Crude for February delivery is slumping $1.11 to $52.46 a barrel after reaching an eleven-month high on Thursday.
Reflecting the weakness in the energy sector, the Philadelphia Oil Service Index is down by 3.9 percent and the NYSE Arca Oil Index is down by 3.3 percent.
Banking stocks are also seeing significant weakness on the day, with the KBW Bank Index tumbling by 3.1 percent after ending the previous session its best closing level in a year.
Transportation, chemical and gold stocks are also showing notable moves to the downside, while some strength has emerged among interest rate-sensitive utilities and commercial real estate stocks.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Friday. Japan's Nikkei 225 Index slid by 0.6 percent, while Hong Kong's Hang Seng Index rose by 0.3 percent.
Meanwhile, the major European markets all shoed significant moves to the downside on the day. While the U.K.'s FTSE 100 Index slumped by 1 percent, the French CAC 40 Index and the German DAX Index tumbled by 1.2 percent and 1.4 percent, respectively.
In the bond market, treasuries have moved higher over the course of the trading session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 4 basis points at 1.089 percent.
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