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Stocks Continue To Benefit From Recent Upward Momentum - U.S. Commentary


Extending the upward trend seen over the past several sessions, stocks have moved mostly higher during trading on Thursday. With the continued strength, the major averages have once again reached new record intraday highs.

Currently, the major averages are just off their highs of the session. The Dow is up 83.68 points or 0.4 percent at 22,745.32, the Nasdaq is up 26.60 points or 0.4 percent at 6,561.22 and the S&P 500 is up 10.04 points or 0.4 percent at 2,547.78.

The continued strength on Wall Street reflects recent upward momentum, with the S&P 500 moving higher for the eighth consecutive session.

Stocks have recently benefited from a batch of largely upbeat U.S. economic data as well as optimism about the outlook for tax reform.

Trading activity has remained somewhat subdued, however, with the closely watched monthly jobs report due on Friday keeping some traders on the sidelines.

Employment is expected to rise by 90,000 jobs in September after climbing by 156,000 jobs in August. The unemployment rate is expected to hold at 4.4 percent.

The Labor Department released a report this morning showing first-time claims for unemployment benefits fell by more than expected in the week ended September 30th.

The report said initial jobless claims dropped to 260,000, a decrease of 12,000 from the previous week's unrevised level of 272,000. Economists had expected jobless claims to edge down to 265,000.

A separate report from the Commerce Department showed that the trade deficit narrowed by more than anticipated in the month of August.

The report said the trade deficit narrowed to $42.4 billion in August from a revised $43.6 billion in July. The trade deficit had been expected to narrow to $42.7 billion.

The Commerce Department also released a report showing factory orders jumped by 1.2 percent in August compared to estimates for an increase of 1.0 percent.

Sector News

Oil service stocks have moved notably higher over the course of the trading session, driving the Philadelphia Oil Service Index up by 1.2 percent.

The strength in the oil service sector comes amid a sharp increase by the price of crude oil, with crude for November delivery jumping $1 to $50.98 a barrel.

Considerable strength is also visible among steel stocks, as reflected by the 1.1 percent gain being posted by the NYSE Arca Steel Index. Brazil's CSN (SID) and Gerdau (GGB) are posting standout gains.

Financial, natural gas, and retail stocks have also moved to the upside on the day, while most of the other major sectors are showing more modest moves.

Other Markets

In overseas trading, stocks in the Asia-Pacific region turned in a lackluster performance on Thursday, with markets in China, Hong Kong, and South Korea closed for holidays. Japan's Nikkei 225 Index closed marginally higher.

Meanwhile, European stocks moved mostly higher over the course of the trading day. The U.K.'s FTSE 100 Index climbed by 0.5 percent and the French CAC 40 Index rose by 0.3 percent, although the German DAX Index closed just below the unchanged line.

In the bond market, treasuries have moved to the downside after closing roughly flat for two straight sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 2.5 basis points at 2.355 percent.

by RTTNews Staff Writer

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