U.S. Stocks Move Modestly Higher In Light Trading

(RTTNews) - Following the mixed performance seen in the previous session, the major U.S. stock indexes have all moved higher in morning trading on Thursday. Buying interest has remained relatively subdued, however, limiting the upside.

Currently, the major averages are posting modest gains. While the Nasdaq is up 60.21 points or 0.5 percent at 13,165.11 after falling sharply on Wednesday, the Dow is up 60.68 points or 0.2 percent at 33,725.70 and the S&P 500 is up 8.94 points or 0.1 percent at 4,276.46.

The modest strength on Wall Street may partly reflect easing concerns about the outlook for interest rates following the release of a Labor Department report showing initial jobless claims increased by much more than expected in the week ended June 3rd.

The Labor Department said initial jobless claims climbed to 261,000, an increase of 28,000 from the previous week's revised level of 233,000.

Economists had expected jobless claims to inch up to 235,000 from the 232,000 originally reported for the previous week.

With the much bigger than expected advance, jobless claims reached their highest level since hitting 264,000 in the week ended October 30, 2021.

While economists noted jobless claims can be volatile around holidays like Memorial Day, the data seems to have added to optimism about the Federal Reserve pausing its interest rate hikes next week.

The Fed, which has previously warned about the impact of labor market tightness, is due to announce its latest monetary policy decision next Wednesday.

CME Group's FedWatch Tool is currently indicating a 71.4 percent chance the Fed will leave interest rates unchanged and a 28.6 percent chance of another quarter point rate hike.

Key inflation reports are also likely to be in the spotlight next week, as the data could impact whether the Fed resumes its rate hikes next month.

Sector News

Gold stocks have shown a strong move to the upside on the day, resulting in a 2.0 percent jump by the NYSE Arca Gold Bugs Index.

The rally by gold stocks comes amid a sharp increase by the price of the precious metal, with gold for August delivery surging 424.80 to $1,983.20 an ounce.

Significant strength is also visible among retail stocks, as reflected by the 1.3 percent gain being posted by the Dow Jones U.S. Retail Index.

Meanwhile, financial stocks are seeing notable weakness, dragging the KBW Bank Index and the NYSE Arca Broker/Dealer Index down by 1.3 percent and 1.0 percent, respectively.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in yet another mixed performance on Thursday. Japan's Nikkei 225 Index slid by 0.9 percent, while China's Shanghai Composite Index climbed by 0.5 percent.

The major European markets have also turned mixed on the day. While the U.K.'s FTSE 100 Index is down by 0.4 percent, the German DAX Index is just above the unchanged line and the French CAC 40 Index is up by 0.2 percent.

In the bond market, treasuries have moved to the upside over the course of the morning after seeing initial weakness. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 3.5 basis points at 3.749 percent.