Stocks are on the upside by solid margins in mid-morning trading on Thursday, following the day's better than expected reading on weekly jobless claims levels. While the major averages have come off of their best levels, they remain firmly positive.
The Dow is currently up 57.40 points or 0.6 percent at 10,444.41, the Nasdaq is up 15.46 or 0.7 percent at 2,244.33 and the S&P 500 is up 8.77 points or 0.8 percent at 1,107.64.
Before the start of trading, the Labor Department said that initial 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.
Commenting on the data, 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 said 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.
In global economic news, the Australian Bureau of Statistics revealed that the Australian jobless rate unexpectedly declined to 5.1 percent in August from 5.3 percent in July.
On the corporate front, McDonald's (MCD) announced global comparable sales growth of 4.9 percent in August, with U.S. comparable sales increasing 4.6 percent and sales in Europe rising by 2.2 percent. Sales in the Asia/Pacific, Middle East and Africa rose 7.8 percent, with Japan, China and Australia leading the way.
After the markets closed for trading in the previous session, Men's Wearhouse (MW) said that its second quarter profit rose 8 percent from last year, helped by higher sales and improved margins. The company's quarterly earnings and sales came in above analysts' expectations. The company also provided an upbeat outlook for the third quarter.
Sector News
Banking stocks are among the morning's best performers, driving the Kbw Bank Index up by 2.5 percent. With the advance, the index has risen to a one-month intraday high.
Software stocks are also moving markedly higher, with the NYSE Arca Software Index rising by 1.7 percent to a six-week intraday high.
Oil service, healthcare provider, housing and health insurance stocks are also being buoyed by early buying, while moderate weakness is visible among railroad and gold stocks.
Notably, the Dow Jones Railroads Index is down by 0.5 percent, pulling back off of the more than two-month closing high set on Wednesday.
Stocks Driven By Analyst Comments
Chemicals firm Celanese (CE) is trading higher after being upgraded at Citigroup from Hold to Buy based on its growth in China. The stock is up by 1.3 percent after setting a two and a half month intraday high in earlier trading.
On the other hand, Tellabs (TLAB) is trading lower following a downgrade at Soleil from Buy to Hold based on eroding market share. Shares are currently down by 1 percent, pulling back further off of last week's one-month closing high.
Valspar (VAL) is also down after analysts at Citigroup downgraded the stock from Buy to Hold. The stock is posting a loss of 1.8 percent, slipping from the three-week high set late last week.
Other Markets
Overseas, stock markets in the Asia-Pacific region ended mostly higher on Thursday. Japan's benchmark Nikkei 225 Index rose by 0.4 percent, while Hong Kong's Hang Seng Index advanced by 0.8 percent.
The major European markets are also moving higher by varied margins. The U.K.'s FTSE 100 Index is up by 1.2 percent, while the French CAC 40 Index and the German DAX Index are up by 1 percent and 0.9 percent, respectively.
In the bond markets, treasuries are showing moderate weakness. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is trading at 2.713 percent, posting a gain of 5.9 basis points.
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