(Corrects Reuters Instrument Code for materials sector in paragraph 8)
* China factory data at 6-1/2-yr low, U.S. at 2-yr low
* Copper prices rebound, Brent rises toward $50 a barrel
* Intel up after Bernstein rating upgrade
* Indexes: Dow up 0.14 pct, S&P flat, Nasdaq up 0.08 pct
By Abhiram Nandakumar and Tanya Agrawal
Sept 23 (Reuters) - U.S. stocks were little changed in light trading on Wednesday morning as a rebound in commodity prices helped soften the impact of weak factory data out of China and the United States.
Copper bounced from near four-week lows as short sellers took profits. Brent crude oil prices inched toward $50 per barrel after data showed a decline in U.S. stockpiles last week.
Growth in the U.S. manufacturing sector showed no month-over-month change in September, staying at its weakest in almost two years, according to an industry report.
Data showed Chinese factory activity shrank to a 6-1/2 year low in September, falling for the seventh month in a row in the world’s second-biggest economy.
“There is unbridled fear that China is slipping into a recession and will take the rest of the world with it,” said Scott Schermerhorn, chief investment officer at Granite Investment Advisors.
“I don’t think it is true but investors are operating in pure fear-driven mode.”
At 10:17 a.m. EDT the Dow Jones industrial average was down 23.47 points, or 0.14 percent, at 16,307. The S&P 500 was up 0.01 points, at 1,942.75 and the Nasdaq Composite was up 3.77 points, or 0.08 percent, at 4,760.49.
Six of the 10 major S&P sectors were lower with the material sector’s 0.4 percent loss leading the decliner. Health stocks continued their decline, with the Nasdaq biotech index down 1 percent.
Schermerhorn said volatility was likely to continue until the third-quarter corporate earnings season, and that valuations remained reasonable and represented a good buying opportunity.
The CBOE Volatility index <.VIX >, popularly known as the “fear gauge”, was up 0.5 percent at 22.54, above its long-term average of 20.
The volatility in the U.S. stock market has increased since Aug. 20 as investors fret over a China-led global economic slowdown and the timing of a Federal Reserve interest rate hike.
But, the Fed’s decision last week to hold interest rates steady at near-zero levels has only increased uncertainty.
Intel was up 0.5 percent at $28.80 after Bernstein upgraded the stock to “marketperform” from “underperform”.
Advancing issues outnumbered decliners on the NYSE by 1,443 to 1,318. On the Nasdaq, 1,316 issues rose and 1,119 fell.
The S&P 500 index showed no new 52-week highs and 13 new lows, while the Nasdaq recorded 14 new highs and 46 new lows. (Reporting by Abhiram Nandakumar and Tanya Agrawal in Bengaluru; Editing by Savio D‘Souza)