After showing a lack of direction over the two previous sessions, stocks have moved modestly higher in morning trading on Thursday. The major averages have all moved to the upside, with the Dow inching up to a new record intraday high.
Currently, the major averages are holding on to slim gains. The Dow is up 26.47 points or 0.1 percent at 31,464.27, the Nasdaq is up 51.87 points or 0.4 percent at 14,024.40 and the S&P 500 is up 6.65 points or 0.2 percent at 3,916.53.
Buying interest has remained somewhat subdued, but traders have also largely refrained from cashing in on the recent strength in the markets amid concerns about missing out on further upside.
Optimism about additional stimulus continues to support the markets along with largely upbeat earnings news, a slowdown in the rate of coronavirus infections and accelerated vaccine rollouts.
Nonetheless, traders have recently seemed somewhat reluctant to make substantial moves amid concerns the markets are becoming overbought.
The modest strength on Wall Street comes following the release of a report from the Labor Department showing jobless claims decreased from an upwardly revised level but came in above estimates.
The Labor Department said initial jobless claims edged down to 793,000 in the week ended February 6th, a decrease of 19,000 from the previous week’s revised level of 812,000.
Economists had expected jobless claims to drop to 757,000 from the 779,000 originally reported for the previous week.
“Additional fiscal stimulus and broader vaccine diffusion will eventually allow the labor market to heal,” said Nancy Vanden Houten, Lead U.S. Economist at Oxford Economics.
She continued, “But as the January employment data showed, current conditions are still quite weak and declines in new jobless claims are likely to occur only gradually in the near term.”
Last Friday, the Labor Department released a separate report showing a modest rebound in U.S. employment in the month of January.
Traders have recently looked for the silver lining in most major economic data, seeing upbeat data as positive for the economy and seeing weaker than expected data as putting pressure on lawmakers to pass more stimulus.
Semiconductor stocks have shown a strong move to the upside in morning trading, driving the Philadelphia Semiconductor Index up by 1.7 percent.
Significant strength is also visible among computer hardware stocks, with the NYSE Arca Computer Hardware Index climbing by 1.2 percent to a record intraday high.
On the other hand, oil service stocks have moved to the downside amid a modest pullback by the price of crude oil.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Thursday, with several major markets closed for holidays. Hong Kong’s Hang Seng Index rose b0.5 percent, while Australia’s S&P/ASX 200 Index slipped by 0.1 percent.
Meanwhile, European stocks have moved mostly higher on the day, with the pan-European STOXX 600 Index rising by 0.3 percent. While the German DAX Index has also advanced by 0.7 percent, the French CAC 40 Index and the U.K.’s FTSE 100 Index are lingering near the unchanged line.
In the bond market, treasuries have shown a modest move to the downside after turning higher over the course of the previous session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 1.4 basis points at 1.147 percent.
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