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Major Averages Close Modestly Higher Following Choppy Trading Day

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Stocks showed a lack of direction over much of the trading day on Thursday before ending the session modestly higher. With the uptick on the day, the major averages extended the rebound seen over the two previous sessions.

The major averages all finished the day in positive territory but off their highs of the session. The Dow inched up 25.35 points or 0.1 percent to 34,823.35, the Nasdaq rose 52.64 points or 0.4 percent to 14,684.60 and the S&P 500 edged up 8.79 points or 0.2 percent to 4,367.48.

The modestly higher close on Wall Street may have reflected recent upward momentum, as stocks continued to recover from the sell-off on Monday.

However, traders seemed reluctant to make significant moves following the recent volatility, which saw the major averages plunge on Monday only to rebound strongly on Tuesday and Wednesday.

The advance seen over the past few days more than offset the sell-off to start the week, although the major averages remain below the record closing highs set last Monday.

Traders were also digesting some mixed economic data, including a report from the Labor Department showing an unexpected increase in initial jobless claims in the week ended July 17th.

The Labor Department said initial jobless claims climbed to 419,000, an increase of 51,000 from the previous week's revised level of 368,000.

The rebound surprised economists, who had expected jobless claims to edge down to 350,000 from the 360,000 originally reported for the previous week.

Meanwhile, a separate report from the National Association of Realtors showing existing home sales rebounded in the month of June following four straight monthly declines.

NAR said existing home sales jumped by 1.4 percent to an annual rate of 5.86 million in June after slumping by 1.2 percent to a revised rate of 5.78 million in May.

Economists had expected existing home sales to surge up by 1.7 percent to a rate of 5.90 million from the 5.80 million originally reported for the previous month.

With the monthly increase, existing home sales rebounded after falling to their lowest level in eleven months in May.

Sector News

Despite the higher close by the broader markets, oil service stocks showed a substantial pullback on the day, dragging the Philadelphia Oil Service Index down by 1.8 percent.

The pullback by oil service stocks came even though the price of crude oil for August delivery jumped $1.61 to $71.91 a barrel.

Considerable weakness was also visible among financial stocks, with the KBW Bank Index and the NYSE Arca Broker/Securities Index falling by 1.6 percent and 1.3 percent, respectively.

On the other hand, software stocks showed a strong move to the upside on the day, driving the Dow Jones U.S. Software Index up by 1.6 percent to a new record closing high.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Thursday. Hong Kong's Hang Seng Index surged up by 1.8 percent.

Meanwhile, the major European markets turned in a mixed performance on the day. While the U.K.'s FTSE 100 Index fell by 0.4 percent, the French CAC 40 Index edged up by 0.3 percent and the German DAX Index climbed by 0.6 percent.

In the bond market, treasuries regained ground following the pullback seen over the two previous sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, dipped by 1.5 basis points to 1.265 percent.

Looking Ahead

Following the release of some key U.S. economic data this morning, the economic calendar for Friday is relatively quiet.

Earnings news may subsequently hog the spotlight, with Intel (INTC), Twitter (TWTR), Capital One (COF), and Snap (SNAP) among the companies reporting their quarterly results after the close of today's trading.

American Express (AXP), Honeywell (HON), Kimberly-Clark (KMB) and Schlumberger (SLB) are also among the companies due to report their quarterly results before the start of trading on Friday.

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