Stocks showed a notable move to the upside at the start of trading on Thursday, as traders reacted to a report showing a much bigger than expected drop in weekly jobless claims. The major averages all moved sharply higher, adding to the gains posted in the previous session.
The initial strength in the markets came following the release of a report from the Labor Department showing that jobless claims fell to 451,000 in the week ended September 4th from the previous week's revised figure of 478,000.
Economists had been expecting jobless claims to edge down to 470,000 from the 472,000 originally reported for the previous week.
With the bigger than expected decrease, jobless claims fell to their lowest level since falling to a nearly two-year low of 427,000 in the week ended July 7th, although they remain at a relatively high level.
Peter Boockvar, equity strategist at Miller Tabak, said, "Labor Day weekend may have had an impact on the seasonal adjustment but we'll have to see next week to what extent."
"Either way though, the market will take a downward move to the lowest since early July in light of the worrisome rise over the past month," he added.
A separate report from the Commerce Department showed that the U.S. trade deficit narrowed to $42.8 billion in July from a revised $49.8 billion in June. The trade deficit had been expected to narrow to $47.3 billion from the $49.9 billion originally reported for the previous month.
Banking stocks are helping to lead the markets higher once again, driving the Kbw Bank Index up by 2.2 percent. With the upward move, the index has risen to its best intraday level in almost a month.
Most of the other major sectors have also moved to the upside in early trading, with software, oil service, and housing stocks turning in some of the best performances.
While the major averages have not seen much follow-through on their initial upward move, they remain firmly positive. The Dow is up 74.47 points or 0.7 percent at 10,461.48, the Nasdaq is up 18.55 points or 0.8 percent at 2,247.42 and the S&P 500 is up 10.22 points or 0.9 percent at 1,109.09.
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June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.