A directional drilling tool includes a housing defining a central cavity for enabling the transmission of drilling fluid through the drill string. A motor contained in the housing includes a rotor-stator assembly, and produces eccentric motion of the rotor. An inverter or shock absorbing assembly disposed along the housing upstream from the motor functions to expend and contract the central cavity in response to fluid pressure changes produced by the drilling fluid flow. A valve assembly, comprising a multi-port flow head that rotates under influence of the motor and a multi-port flow restrictor, creates a varying pattern of pressure spikes in the drilling fluid as the ports of the flow head move into and out of alignment with the ports of the flow restrictor, which in turn induces a percussive effect and axial movement in the drill string.