Stocks have continued to fluctuate throughout the trading session on Thursday, with the major averages bouncing back and forth across the unchanged line after moving sharply lower over the course of the two previous sessions.
Currently, the major averages are turning in a mixed performance. While the Dow is down 63.77 points or 0.2 percent at 34,896.92, the Nasdaq is up 47.63 points or 0.3 percent at 14,573.54 and the S&P 500 is up 7.43 points or 0.2 percent at 4,407.70.
The volatility on Wall Street comes as traders express some uncertainty about the near-term outlook for the markets after initial weakness dragged the major averages down to their lowest intraday levels in almost a month.
The initial move to the downside came as traders continued to digest the minutes of the Federal Reserve’s latest monetary policy meeting.
The minutes indicated that most Fed officials currently expect economic conditions to warrant scaling back the central bank’s asset purchase program before the end of the year.
The Fed restarted its asset purchase program back in March of 2020 and is currently purchasing bonds at a pace of $120 billion per month.
The asset purchase program has helped to prop up the markets throughout much of the coronavirus pandemic, with stocks reaching record highs even as the economy struggled.
However, the minutes showed there was still some disagreement about the timing of tapering the asset purchases, leading to some uncertainty on Wall Street.
Potentially adding evidence to Fed officials’ view that the economy is close to the goal of maximum employment, the Labor Department released a report this morning showing initial jobless claims fell to a new pandemic-era low in the week ended August 14th.
The Labor Department said initial jobless claims fell to 348,000, a decrease of 29,000 from the previous week’s revised level or 377,000.
Economists had expected jobless claims to edge down to 363,000 from the 375,000 originally reported for the previous week.
Initial jobless claims decreased for the fourth consecutive week, falling to their lowest level since hitting 256,000 in the week ended March 14, 2020.
While the broader markets have shown a lack of direction on the day, steel stocks have shown a substantial move to the downside. The NYSE Arca Steel Index is down by 4 percent after hitting its lowest intraday level in a month.
Significant weakness also remains visible among energy stocks, which are moving sharply lower along with the price of crude oil. Crude for September delivery is tumbling $1.89 to $63.57 a barrel.
Reflecting the weakness in the energy sector, the Philadelphia Oil Service Index is down by 3.5 percent, the NYSE Arca Oil Index is down by 3.1 and the NYSE Arca Natural Gas Index is down by 2 percent.
Airline stocks also continue to see considerable weakness in afternoon trading, resulting in a 2.3 percent slump by the NYSE Arca Airline Index.
Financial, computer hardware and gold stocks are also notable lower on the day, while software and semiconductor stocks have shown strong moves to the upside.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Thursday. Japan’s Nikkei 225 Index slumped by 1.1 percent, while Hong Kong’s Hang Seng Index plunged by 2.1 percent.
The major European markets also showed significant moves to the downside on the day. While the French CAC 40 Index plummeted by 2.4 percent, the U.K.’s FTSE 100 Index and the German DAX Index tumbled by 1.5 percent and 1.3 percent, respectively.
In the bond market, treasuries remain firmly positive after an initial advance. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 2.8 basis points at 1.245 percent.
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