With traders reluctant to make any significant moves, stocks turned in another lackluster performance during trading on Thursday. The major averages remained stuck near the unchanged line throughout the session after ending the previous session nearly flat.
The major averages eventually ended the session mixed, with the Dow edging down 10.45 points or 0.1 percent to 13,165.19, while the Nasdaq rose 7.39 points or 0.3 percent to 3,018.64 and the S&P 500 crept up 0.58 points or less than a tenth of a percent to 1,402.80.
The choppy trading on Wall Street came as traders expressed continued uncertainty about the near-term outlook for the markets following recent strength.
While optimism about further monetary stimulus helped to drive stocks higher in recent weeks, traders seem reluctant to continue buying without any official announcement.
At the same time, some upbeat economic data helped to keep traders from cashing in on the recent gains, with a report from the Labor Department showing an unexpected drop in weekly jobless claims.
The report showed that initial jobless claims fell to 361,000 in the week ended August 4th from the previous week's revised figure of 367,000. Economists had expected jobless claims to edge up to 367,000 from the 365,000 originally reported for the previous week.
A separate report from the Commerce Department showed that the U.S. trade deficit narrowed to $42.9 billion in June from $48.0 billion in May. The trade deficit had been expected to narrow to $47.5 billion.
The narrower than expected trade deficit reflected an increase in the value of exports and a decrease in the value of imports.
Among individual stocks, shares of Allscripts Healthcare (MDRX) showed a strong upward move after the healthcare information services provider reported weaker than expected second quarter earnings but raised its full year earnings guidance. Allscripts surged up by 18.4 percent on the day.
Online broker E*Trade (ETFC) also turned in a strong performance, advancing by 6.9 percent on news that CEO Steven Freiberg has left the company. E*Trade named Chairman Frank Petrilli as interim CEO.
Meanwhile, shares of SunPower (SPWR) came under pressure after the solar products and services company provided disappointing guidance. SunPower fell by 10.5 percent.
Sector News
While most of the major sectors showed only modest moves on the day, considerable strength was visible among networking stocks. The NYSE Arca Networking Index advanced by 1.7 percent, reaching a new one-month closing high.
Infinera (INFN), Juniper Networks (JNPR) and Cisco (CSCO) turned in some of the networking sector's best performances.
Housing stocks also saw significant strength, driving the Philadelphia Housing Sector Index up by 1.5 percent. KB Home (KBH) and Hovnanian Enterprises (HOV) posted standout gains.
Brokerage, gold, and oil service stocks also moved to the upside on the day, although buying interest was relatively subdued.
On the other hand, airline stocks came under considerable selling pressure, dragging the NYSE Airline Index down by 1.4 percent. Railroad and trucking stocks also saw notable weakness.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Thursday. Japan's Nikkei 225 Index advanced by 1.1 percent, while Hong Kong's Hang Seng Index surged up by 1 percent.
Meanwhile, the major European markets turned mixed over the course of the trading day. While the German DAX Index closed just below the unchanged line, the U.K.'s FTSE 100 Index edged up by 0.1 percent and the French CAC 40 Index rose by 0.5 percent.
In the bond market, treasuries moved notably lower, extending a recent downward move. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, jumped 4.8 basis points to a two-month closing high of 1.688 percent.
Looking Ahead
Trading activity may remain somewhat subdued on Friday amid a relatively light day on the U.S. economic front. Nonetheless, the Labor Department's monthly report on import and exports prices may attract some attention.
On the earnings front, Nvidia (NVDA), Nordstrom (JWN), and DeVry (DV) are among the companies releasing their quarterly results after the close of today's trading.
by RTT Staff Writer
For comments and feedback: editorial@rttnews.com
Market Analysis