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Stocks Turning In Another Lackluster Performance - U.S. Commentary

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Following the lackluster performance seen in the previous session, stocks have continued to experience choppy trading on Thursday. The major averages have once again spent the day bouncing back and forth across the unchanged line.

Currently, the major averages are turning in a mixed performance. While the Nasdaq is down 8.15 points or 0.1 percent at 7,987.93, the Dow is up 97.08 points or 0.4 percent at 26,546.62 and the S&P 500 is up 2.55 points or 0.1 percent at 2,903.00.

Stocks continue to show a lack of direction as traders seem reluctant to make more significant moves going into the long Easter weekend.

Traders may also be looking ahead to the slew of quarterly earnings news scheduled to be released next week as earnings season continues to pick up steam.

Coca-Cola (KO), Procter & Gamble (PG), Boeing (BA), Facebook (FB), Microsoft (MSFT), Amazon (AMZN), Intel (INTC), and Exxon Mobil (XOM) are just a few of the big-name companies due to report their results.

Initial buying interest was generated by upbeat economic data, although buying interest waned shortly after the open amid lingering concerns about the strength of the economy going forward.

Before the start of trading, the Commerce Department released report showing retail sales rebounded by much more than expected in the month of March.

The Commerce Department said retail sales soared by 1.6 percent in March after edging down by 0.2 percent in February. Economists had expected retail sales to climb by 0.9 percent.

Excluding a jump in sales by motor vehicle and parts dealers, retail sales still surged up by 1.2 percent in March following a revised 0.2 percent dip in February.

Ex-auto sales had been expected to increase by 0.7 percent compared to the 0.4 percent drop originally reported for the previous month.

The report said closely watched core retail sales, which exclude autos, gasoline, building materials and food services, also jumped by 1.0 percent in March after falling by 0.3 percent in February.

"Overall, the retail sales figures add to the slightly more positive tone of the recent data and provide some comfort that the economy isn't falling off a cliff," said Andrew Hunter, Senior U.S. Economist at Capital Economics.

He added, "But they don't change our view that the fading of the fiscal boost and the lagged impact of the Fed's monetary tightening will push GDP growth below its 2% potential pace over the coming quarters."

A separate report from the Labor Department showed initial jobless claims unexpectedly edged lower in the week ended April 13th, falling to a nearly 50-year low.

The report said initial jobless claims dipped to 192,000, a decrease of 5,000 from the previous week's revised level of 197,000. Economists had expected jobless claims to rise to 205,000.

With the unexpected decrease, initial jobless claims dropped to their lowest level since hitting 182,000 in September of 1969.

Sector News

Biotechnology stocks have climbed off their worst levels of the day but continue to see significant weakness in mid-day trading.

After hitting its lowest intraday level in over three months, the NYSE Arca Biotechnology Index is down by 1.4 percent.

Considerable weakness also remains visible among tobacco stocks, as reflected by the 1.5 percent drop by the NYSE Arca Tobacco Index. The index hit a two-month intraday low earlier in the session.

Natural gas and steel stocks also continue to see some weakness on the day, while most of the other major sectors are showing more modest moves.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Thursday. Japan's Nikkei 225 Index slid by 0.8 percent, while China's Shanghai Composite Index fell by 0.4 percent.

Meanwhile, the major European markets turned in a mixed performance on the day. While the U.K.'s FTSE 100 Index dipped by 0.2 percent, the French CAC 40 Index rose by 0.3 percent and the German DAX Index climbed by 0.6 percent, respectively.

In the bond market, treasuries have pulled back off their highs of the session but remain positive. As a result, the yield on benchmark ten-year note, which moves opposite of its price, is down by 3.1 basis points at 2.561 percent.

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