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Stocks May Give Back Ground In Early Trading - U.S. Commentary


After ending the previous session modestly higher, stocks may give back some ground in early trading on Thursday. The major index futures are currently pointing to a lower open for the markets, with the Dow futures down by 21 points.

Profit taking may contribute to initial weakness on Wall Street after the major averages ended Wednesday's trading at new record closing highs.

Traders are also digesting earnings news from financial giants Citigroup (C) and JPMorgan Chase (JPM) as the earnings season gets underway.

Citigroup and JPMorgan both reported better than expected third quarter earnings, although JPMorgan reported a steep drop in bond trading revenue.

On the U.S. economic front, the Labor Department released a report showing that producer prices increased in line with economist estimates in the month of September.

The Labor Department said its producer price index for final demand climbed by 0.4 percent in September after edging up by 0.2 percent in August.

Excluding food and energy prices, core producer prices still rose by 0.4 percent in September after inching up by 0.1 percent in August. Core prices had been expected to rise by 0.2 percent.

A separate Labor Department report showed first-time claims for unemployment benefits fell by more than anticipated in the week ended October 7th.

The report said initial jobless claims dropped to 243,000, a decrease of 15,000 from the previous week's revised level of 258,000. Economists had expected jobless claims to dip to 251,000.

Stocks turned in another relatively lackluster performance during trading on Wednesday but managed to end the session modestly higher. With the gains on the day, the major averages climbed to new record closing highs.

The major averages ended the session at their best levels of the day. The Dow edged up 42.21 points or 0.2 percent to 22,872.89, the Nasdaq rose 16.30 points or 0.3 percent to 6,603.55 and the S&P 500 crept up 4.60 points or 0.2 percent to 2,555.24.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Thursday. Japan's Nikkei 225 Index climbed by 0.4 percent, while Hong Kong's Hang Seng Index rose by 0.2 percent.

Meanwhile, the major European markets are turning in a mixed performance on the day. While the U.K.'s FTSE 100 Index has advanced by 0.4 percent, the German DAX Index is just below the unchanged line and the French CAC 40 Index is down by 0.2 percent.

In commodities trading, crude oil futures are sliding $0.69 to $50.61 a barrel after rising $0.38 to $51.30 a barrel on Wednesday. Meanwhile, an ounce of gold is trading at $1,294.70, up $5.80 compared to the previous session's close of $1,288.90. On Wednesday, gold fell $4.90.

On the currency front, the U.S. dollar is trading at 112.40 yen compared to the 112.50 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.1846 compared to yesterday's $1.1859.

by RTTNews Staff Writer

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