North American stocks were relatively unchanged in midday trading on Tuesday after recovering from losses earlier in the day, with investors taking an upbeat view on Federal Reserve chairman Ben Bernanke’s testimony in Washington.
At noon, the Dow Jones industrial average was up 7 points or less than 0.1 per cent, to 12,734, after being down more than 80 points.
The broader S&P 500 was up less than 1 point, to 1,354. In Canada, the S&P/TSX composite index was down 8 points or less than 0.1 per cent, to 11,513.
Although there was a flurry of economic reports for investors to digest – including a 0.4 per cent gain in U.S. industrial production in June, a rise in homebuilder confidence and a 2.2 per cent gain in U.S. “core” inflation over last year – the focus was largely on Mr. Bernanke’s testimony before the Senate Banking Committee.
Mr. Bernanke’s remarks fed some concerns after he said that reducing unemployment would be “frustratingly slow” and offered no solutions in the form of additional stimulus.
Later, however, he added that stimulus would come if the labour market does not improve, putting major indexes on the mend.
Within the S&P 500, economically defensive areas of the market showed the biggest gains, with telecom stocks up 0.7 per cent and health care stocks up 0.5 per cent.
Cyclical stocks tended to lag. Financials fell 0.4 per cent after Goldman Sachs Group Inc. reported that its second quarter earnings fell 11 per cent from last year but topped analysts’ expectations. Technology stocks and industrials fell 0.2 per cent each.
In Canada, materials fell 1.4 per cent after the price of gold fell to $1,576 (U.S.) an ounce, down $16. Financials were unchanged.
In Europe, the U.K.’s FTSE 100 fell 0.6 per cent and Germany’s DAX index rose 0.2 per cent.
Spanish and Italian bond yields were relatively steady, with Spain’s 10-year government bond holding at 6.73 per cent.