Major Averages Turn Mixed, With Microsoft Weighing On The Dow

wallstreet2 02jun22 lt

After moving to the downside early in the session, the major U.S. stock indexes have turned mixed over the course of morning trading on Thursday. While the tech-heavy Nasdaq has bounced into positive territory, the Dow remains in the red.

Currently, the major averages are stuck on opposite sides of the unchanged lined. The Nasdaq is up 39.41 points or 0.3 percent at 12,033.87, but the Dow is down 165.93 points or 0.5 percent at 32,647.30 and the S&P 500 is down 8.37 points or 0.2 percent at 4,092.86.

A notable decline by shares of Microsoft (MSFT) is weighing on the Dow, with the software giant slumping by 2.3 percent.

The drop by Microsoft comes after the company lowered its earnings and revenue guidance for its fiscal fourth quarter.

Microsoft said it provided the updated guidance to help investors understand the impact of unfavorable foreign exchange movement during the quarter.

The mixed performance on Wall Street also comes as disappointing private sector jobs data raised concerns about the economy while also generating optimism the Federal Reserve will be less aggressive in raising interest rates.

Payroll processor ADP said private sector employment climbed by 128,000 jobs in May after jumping by a downwardly revised 202,000 jobs in April.

Economists had expected private sector employment to surge by 300,000 jobs compared to the addition of 247,000 jobs originally reported for the previous month.

Meanwhile, the Labor Department released a report showing first-time claims for U.S. unemployment benefits unexpectedly declined in the week ended May 28th.

The report showed initial jobless claims fell to 200,000, a decrease of 11,000 from the previous week's revised level of 211,000.

Economists had expected jobless claims to come in unchanged compared to the 210,000 originally reported for the previous week.

On Friday, the Labor Department is scheduled to release its more closely watched monthly employment report, which includes both public and private sector jobs.

Economists currently expect employment to jump by 325,000 jobs in May after surging by 428,000 jobs in April, while the unemployment rate is expected to edge down to 3.5 percent from 3.6 percent.

Gold stocks have shown a substantial move to the upside on the day, driving the NYSE Arca Gold Bugs Index up by 4.5 percent.

The rally by gold stocks comes amid a notable increase by the price of the precious metal, with gold for August delivery jumping $22.80 to $1,871.50 an ounce.

Steel stocks are also turning in a strong performance, as reflected by the 1.9 percent gain being posted by the NYSE Arca Steel Index.

Chemical, semiconductor and computer hardware stocks have also moved to the upside, while weakness is visible among pharmaceutical, utilities and biotechnology stocks.

In overseas trading, stock markets across the Asia-Pacific region turned in another mixed performance during trading on Thursday. Japan's Nikkei 225 Index edged down by 0.2 percent, while China's Shanghai Composite Index rose by 0.4 percent.

Meanwhile, European stocks have moved mostly higher, with the markets in London closed for the queen's Platinum Jubilee. While the French CAC 40 Index is up by 0.9 percent, the German DAX Index is up by 0.6 percent.

In the bond market, treasuries have pulled back off their highs but currently continue to see modest strength. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 1.2 basis points at 2.919 percent.

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