U.S. Stocks Seeing Further Upside Following Early Advance

After moving mostly higher early in the session, stocks have seen further upside over the course of the trading day on Thursday. The Nasdaq and S&P 500 have once again reached their best intraday levels in over a year, while the Dow has jumped to a six-month intraday high.

In recent trading, the major averages have once again reached new highs for the session. The Dow is up 396.64 points or 1.2 percent at 34,375.97, the Nasdaq is up 118.34 points or 0.9 percent at 13,744.81 and the S&P 500 is up 42.97 points or 1.0 percent at 4,415.56.

The strength on Wall Street may reflect optimism about the outlook for interest rates following the release of a slew of U.S. economic data.

While the Federal Reserve forecast further rate hikes on Wednesday, traders seem hopeful the central bank will not follow through.

The optimism may partly stem from a report from the Labor Department showing initial jobless claims held at their highest level since October 2021 in the week ended June 9th.

The Labor Department said initial jobless claims came in at 262,000, unchanged from the previous week’s revised level.

Economists had expected jobless claims to dip to 249,000 from the 261,000 originally reported for the previous week.

A separate Labor Department report showing import prices in the U.S. fell by much more than expected in the month of May has also generated optimism about the outlook for inflation.

The report said import prices slid by 0.6 percent in May, reflecting a sharp pullback in prices for fuel imports and a modest decrease in prices for non-fuel imports. Economists had expected import prices to edge down by 0.1 percent.

“Nonfuel import prices along with the consumer and producer prices suggest that inflation is moderating,” said Matthew Martin, US Economist at Oxford Economics. “Therefore, it’s unlikely that the Fed follows through with their plan to hike rates in the second half of this year.”

Meanwhile, separate reports showed an unexpected increase in retail sales and an unexpected decrease in industrial production.

Sector News

Software stocks continue to see substantial strength in afternoon trading, with the Dow Jones U.S. Software Index jumping by 2.3 percent to its best intraday level in well over a year.

Considerable strength also remains visible among natural gas stocks, which are moving higher amid sharp increase by the price of the commodity.

With natural gas for July delivery is soaring $0.203 to $2.545 per million BTUs, the NYSE Arca Natural Gas Index is up by 1.4 percent.

Healthcare stocks are also seeing a significant rebound after coming under pressure on Wednesday, driving the Dow Jones U.S. Health Care Index up by 1.3 percent.

Transportation, oil and housing stocks are also seeing notable strength, moving higher along with most of the other major sectors.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Thursday. Japan’s Nikkei 225 Index edged down by 0.1 percent, while China’s Shanghai Composite Index climbed by 0.7 percent.

The major European markets also finished the day mixed. While the U.K.’s FTSE 100 Index rose by 0.3 percent, the German DAX Index dipped by 0.1 percent and the French CAC 40 Index fell by 0.5 percent.

In the bond market, treasuries have moved higher over the course of the session after seeing initial weakness. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 7.0 basis points at 3.726 percent.

Source: Read Full Article