After seeing considerable volatility in the previous session, stocks are turning in a lackluster performance in early trading on Thursday. The major averages are showing only modest moves after ending the previous session mixed.
The major averages are currently turning in another mixed performance, with the Dow posting a modest gain. While the Dow is up 10.59 points or 0.1 percent at 12,834.98, the Nasdaq is down 9.59 points or 0.3 percent at 2,920.86 and the S&P 500 is down 1.63 points or 0.1 percent at 1,354.06.
The choppy trading comes as traders continue to digest the Federal Reserve's announcement of its decision to extend its "Operation Twist" program until the end of the year. The program had previously been due to expire this month.
"Operation Twist" involves replacing short-term securities in the Fed's bond portfolio with longer-term securities in an effort to push already low long-term interest rates even lower.
At the same time, the Fed generated some negative sentiment by lowering its GDP forecasts, although Fed Chairman Ben Bernanke noted that the central bank is prepared to take additional steps to prop up the sluggish economy.
Traders are also digesting the Labor Department's report on initial jobless claims in the week ended June 16th, which showed that claims fell modestly for the week but still came in above analyst estimates.
The report showed that jobless claims edged down to 387,000 from the previous week's revised figure of 389,000. Economists had expected claims to dip to 383,000 from the 386,000 originally reported for the previous week.
Most of the major sectors are showing only modest moves, although considerable weakness has emerged among gold stocks. The NYSE Arca Gold Bugs Index is down by 2.3 percent, with the weakness in the sector coming amid a sharp drop by the price of gold.
Semiconductor, networking, and computer hardware stocks have also come under pressure, contributing to a pullback by the tech-heavy Nasdaq. On the other hand, modest strength is visible among airline and utilities stocks.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower on Thursday, although Japan's Nikkei 225 Index bucked the downtrend and rose by 0.8 percent. Hong Kong's Hang Seng Index and China's Shanghai Composite Index fell by 1.3 percent and 1.4 percent, respectively.
Meanwhile, the major European markets are turning in a mixed performance on the day. While the U.K.'s FTSE 100 Index is down by 0.4 percent, the German DAX Index and the French CAC 40 Index are up by 0.5 percent and 0.6 percent, respectively.
In the bond market, treasuries are turning in a lackluster performance along with stocks. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by less than a basis point at 1.635 percent.
by RTT Staff Writer
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