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U.S. Stocks Give Back Ground After Initial Upward Move

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After an initial move to the upside, stocks have given back some ground over the course of morning trading on Thursday. The major averages have pulled back off their highs of the session but currently remain in positive territory.

Currently, the major averages are posting modest gains. The Dow is up 50.04 points or 0.2 percent at 33,870.42, the Nasdaq is up 25.03 points or 0.2 percent at 14,076.06 and the S&P 500 is up 15.95 points or 0.4 percent at 4,199.13.

The Nasdaq and the S&P 500 initially rose to new record intraday highs in reaction to upbeat earnings news from tech giants like Apple (AAPL) and Facebook (FB).

Shares of Apple jumped as much as 2.6 percent to reach a nearly three-month intraday high but have pulled back near the unchanged line since then.

The initial advance by Apple came after the tech giant reported fiscal second quarter earnings that far exceeded analyst estimates and increased its stock buyback and dividend.

Social media giant Facebook has also pulled back off its best levels but is holding on to a strong gain after reporting much better than expected first quarter earnings.

Shares of Qualcomm (QCOM) have also moved notably higher after the chipmaker reported better than expected fiscal second quarter results and provided upbeat guidance.

On the other hand, drug makers Merck (MRK) and Bristol Myers Squibb (BMY) have come under pressure after reporting quarterly earnings that missed analyst estimates.

In U.S. economic news, the Labor Department released a report showing first-time claims for U.S. unemployment benefits dropped to a new pandemic-era low in the week ended April 24th.

The report said initial jobless claims dipped to 553,000, a decrease of 13,000 from the previous week's revised level of 566,000.

Economists had expected jobless claims to inch up to 549,000 from the 547,000 originally reported for the previous week.

Jobless claims fell for the third straight week, once again sliding to their lowest level since hitting 256,000 in the week ended March 14, 2020.

Meanwhile, preliminary data released by the Commerce Department showed an acceleration in the pace of U.S. economic growth in the first three months of 2021.

The report said real gross domestic product surged up by 6.4 percent in the first quarter after jumping by 4.3 percent in the fourth quarter of 2020. Economists had expected GDP to increase by 6.5 percent.

Banking stocks have shown a strong move to the upside in morning trading, driving the KBW Bank Index up by 1.8 percent to a record intraday high.

Considerable strength has also emerged among housing stocks, as reflected by the 1.2 percent gain being posted by the Philadelphia Housing Sector Index. The index has reached its best intraday level since a two-for-one split in early 2006.

Energy stocks are also seeing significant strength on the day, benefiting from another notable increase by the price of crude oil.

On the other hand, gold stocks have moved sharply lower on the day, dragging the NYSE Arca Gold Bugs Index down by 3.1 percent.

The sell-off by gold stocks comes amid a decrease by the price of the precious metal, with gold for June delivery slumping $12.60 to $1,761.30 an ounce.

Software stocks have also come under pressure, extending the pullback seen in the previous session. The Dow Jones U.S. Software Index is down by 1.4 percent.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher on Thursday, with the Japanese markets closed for a holiday. China's Shanghai Composite Index rose by 0.5 percent, while Hong Kong's Hang Seng Index advanced by 0.8 percent.

Meanwhile, the major European markets are turning in a mixed performance on the day. While the U.K.'s FTSE 100 Index is up by 0.2 percent, the French CAC 40 Index is down by 0.1 percent and the German DAX Index is down by 1 percent.

In the bond market, treasuries have come under pressure after ending the previous session nearly unchanged. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 5.5 basis points at 1.675 percent.

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