Stocks have shown a lack of direction over the course of the trading day on Thursday following the sell-off seen in the previous session. The major averages have spent the day bouncing back and forth across the unchanged line.
Currently, the major averages are posting modest gains. The Dow is up 32.00 points or 0.1 percent at 25,477.94, the Nasdaq is up 20.54 points or 0.2 percent at 9,929.70 and the S&P 500 is up 3.57 points or 0.1 percent at 3,053.90.
The choppy trading on Wall Street comes as traders weigh recent optimism about an economic recovery against spiking coronavirus cases in a number of states.
According to a tally by NBC News, the U.S. saw a record 45,557 reported Wednesday, surpassing the peak seen during the first wave of the coronavirus on April 26th.
Traders may be worried about the possibility of states reimposing restrictions on businesses, although the Trump administration has ruled out another lockdown.
Texas Governor Greg Abbott announced that the state will pause its reopening plan due to the recent jump in coronavirus cases.
On the economic front, a report from the Labor Department showed a much smaller than expected drop in initial jobless claims in the week ended June 20th, but the report also showed a notable decrease in continuing claims, a reading on the number of people receiving ongoing unemployment assistance.
Continuing claims tumbled by 767,000 to 19.522 million in the week ended June 13th, hitting their lowest level since mid-April.
A separate report from the Commerce Department also showed a substantial rebound in durable goods orders in the month of May.
The Commerce Department said durable goods orders spiked by 15.8 percent in May after plunging by a revised 18.1 percent in April.
Economists had expected durable goods orders to surge up by 10.9 percent compared to the 17.7 percent nosedive that had been reported for the previous month.
Excluding a significant rebound in orders for transportation equipment, durable goods orders still jumped by 4.0 percent in May after tumbling by 8.2 percent in April. Economists had expected a 2.5 percent increase.
Most of the major sectors are showing only modest moves on the day, although significant strength remains visible among oil service stocks. The Philadelphia Oil Service Index is up by 2.4 percent after hitting its lowest intraday level in a month in early trading.
The rebound by oil service stocks comes as the price of crude oil has also turned higher, as crude for August delivery is jumping $0.95 to $38.96 a barrel after hitting a low of $37.08 a barrel.
Significant strength has also emerged among financial stocks, with the KBW Bank Index and the NYSE Arca Broker/Dealer Index climbing by 2.2 percent and 1.7 percent, respectively.
The strength among financial stocks comes amid news U.S. regulators plan to ease banking regulations, including allowing banks to more easily make investments in riskier funds such as venture capital funds.
On the other hand, considerable weakness remains visible among utilities stocks, as reflected by the 2.3 percent drop by the Dow Jones Utility Average. The average has fallen to its lowest intraday level in over a month.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Thursday. Japan’s Nikkei 225 Index tumbled by 1.2 percent, while Australia’s S&P/ASX 200 Index plummeted by 2.5 percent.
Meanwhile, the major European markets moved to the upside on the day. While the French CAC 40 Index jumped by 1 percent, the German DAX Index advanced by 0.7 percent and the U.K.’s FTSE 100 Index rose by 0.4 percent.
In the bond market, treasuries have pulled back off their best levels but 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 0.672 percent.
Source: Read Full Article