Stocks May Show A Lack Of Direction In Early Trading - U.S. Commentary

(RTTNews) - On the heels of the volatility seen over the past several sessions, stocks may turn in a lackluster performance in early trading on Thursday. The major index futures are currently pointing to a roughly flat open for the markets, with the Dow futures up by just 1 point.

The futures were pointing to a higher open for the markets earlier in the session due in part to some upbeat earnings news.

Shares of Facebook (FB) remain sharply higher in pre-market trading after the social media giant reported fourth quarter results that exceeded analyst estimates.

Online payment service provider PayPal (PYPL) is also likely to see early strength after reporting better than expected fourth quarter results and announcing a $2 billion stock buyback.

On the other hand, shares of Qualcomm (QCOM) may come under pressure after the chipmaker reported first quarter results that beat estimates but provided disappointing guidance.

A very disappointing report on U.S. manufacturing contributed to the pullback by the futures, with the report showing a much steeper than expected drop in durable goods orders.

The Commerce Department said durable goods orders plunged by 5.1 percent in December after falling by a revised 0.5 percent in November. Economists had expected orders to dip by just 0.6 percent.

Excluding a 12.4 percent decrease in orders for transportation equipment, durable goods orders still tumbled by 1.2 percent in December compared to a 0.5 percent drop in November.

Meanwhile, a separate report from the Labor Department showed that initial jobless claims pulled back by more than expected in the week ended January 23rd.

The report said initial jobless claims fell to 278,000, a decrease of 16,000 from the previous week's revised level of 294,000.

Economists had expected jobless claims to pull back to 285,000 from the 293,000 originally reported for the previous week.

Not long after the start of trading, the National Association of Realtors is scheduled to release a separate report on pending home sales in December. Pending sales are expected to climb by 0.8 percent.

A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.

With traders reacting negatively to the Federal Reserve's monetary policy announcement, stocks moved sharply lower over the course of the trading day on Wednesday. The losses on the day partly offset the rally seen on Tuesday.

The major averages saw considerable volatility on the day before closing firmly in negative territory. The Dow tumbled 222.77 points or 1.4 percent to 15,944.46, the Nasdaq plunged 99.51 points or 2.2 percent to 4,468.17 and the S&P 500 slumped 20.68 points or 1.1 percent to 1,882.95.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Thursday. Japan's Nikkei 225 Index dropped by 0.7 percent, while Hong Kong's Hang Seng Index climbed by 0.8 percent.

Meanwhile, the major European markets have all moved to the downside on the day. While the German DAX Index has plunged by 1.7 percent, the French CAC 40 Index is down by 1.3 percent and the U.K.'s FTSE 100 Index is down by 0.8 percent.

In commodities trading, crude oil futures are climbing $0.59 to $32.89 a barrel after advancing $0.85 to $32.30 a barrel on Wednesday. The most actively traded gold futures for April delivery are currently trading at $1,122, up $5.70 from the previous session's close of $1,116.30.

On the currency front, the U.S. dollar is trading at 118.72 yen compared to the 118.68 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.0926 compared to yesterday's $1.0893.