FX.co ★ U.S. Stocks Seeing Modest Weakness Amid Cautious Trading

Following a tepid performance in last Friday's session, stocks are exhibiting minor vulnerability during Monday's trading. All major market indicators have displayed a downturn after the mixed results from the previous session.

At present, the major market gauges are shy of their session lows but remain underwhelmed. The Dow is down by 117.57 points or 0.3 percent at 39,358.33, the Nasdaq by 9.55 points or 0.1 percent at 16,419.27 and the S&P 500 by 5.80 points or 1.1 percent at 5,228.38.

The markets experienced early setbacks due to weaknesses in technology stocks, primarily from the semiconductor giant Intel (INTC), which reportedly plummeted by as much as 4.7 percent, its lowest intraday figure in over four months. This significant slide follows the Financial Times's report that China has implemented new guidelines to gradually replace microprocessors from Intel and Advanced Micro Devices (AMD) in government PCs and servers.

Even though Intel has managed to climb significantly from its low, it continues to be down by 1.4 percent. Meanwhile, AMD has made a comeback into positive territory after initial setbacks. Microsoft (MSFT) shares have also dipped by 1.0 percent, after the news of China's stringent government procurement guideline aiming to replace the Windows operating system and foreign-made database software with domestic options.

Despite these developments, selling pressure has remained relatively modest as traders hesitate to make more significant moves before the publication of key economic data in the upcoming days. Key data such as durable goods orders, consumer confidence, and pending home sales are likely to capture the traders' attention. Personal income and expenditure data, which include the Fed's preferred inflation readings, are set to be released when markets will be closed for Good Friday.

The Commerce Department's report shows an unexpected decline in new U.S. home sales in February. It reports a minor dip of 0.3 percent to an annual rate of 662,000 in February from a revised rate of 664,000 in January. Economists had anticipated new home sales to rise by 2.9 percent to a rate of 680,000 from the 661,000 originally reported for the previous month.

Oil service stocks, driving the Philadelphia Semiconductor Index up by 1.7 percent to a five-month intraday high, have shown a robust upward shift despite the overall market's modest weakness. The rise follows a sharp upsurge in crude oil prices, with May's delivery surging $1.72 to $82.35 per barrel.

The notable upswing in gold prices is further fuelling substantial growth among gold stocks, exemplified by the NYSE Arca Gold Bugs Index's gain of 1.6 percent. Oil producers and computer hardware are also on the upward move, while software and transportation stocks are down.

In international trading, Asian-Pacific markets mainly followed a downward trend on Monday. Japan's Nikkei 225 Index stumbled by 1.2 percent, and China's Shanghai Composite Index slipped by 0.7 percent.

The major European markets showed a mixed performance. The U.K.'s FTSE 100 Index down by 0.1 percent, while both the French CAC 40 Index and the German DAX Index were up by 0.1 percent and 0.3 percent, respectively.

On the bond market, treasuries have reversed after recent gains. Subsequently, the yield on the benchmark ten-year note, which inversely relates to its price, has risen by 2.7 basis points to 4.245 percent.