Major Averages Pull Back Into Negative Territory - U.S. Commentary

(RTTNews) - After failing to sustain an early upward move, stocks have turned lower over the course of the trading session on Thursday. The major averages have pulled back off their highs of the session and into negative territory.

Currently, the major averages are posting modest losses on the day. The Dow is down 16.81 points or 0.1 percent at 19,816.87, the Nasdaq is down 18.07 points or 0.3 percent at 5,420.48 and the S&P 500 is down 2.48 points or 0.1 percent at 2,247.44.

The pullback on Wall Street comes as traders continue to cash in on recent gains, which lifted the tech-heavy Nasdaq to a record closing high on Tuesday.

Nonetheless, traders remain reluctant to make significant moves in the final days of 2016, with some away from their desks ahead of another long weekend.

The performance of the Dow is still likely to attract attention, as traders wait to see if the blue chip index can cross the 20,000 level.

While the Dow has climbed within striking distance of the key psychological level, the pullback seen on Wednesday has dampened hopes the index will break through this year.

On the economic front, the Labor Department released a report showing that initial jobless claims pulled back in line with estimates in the week ended December 24th.

The report said initial jobless claims dipped to 265,000, a decrease of 10,000 from the previous week's unrevised level of 275,000. The drop in jobless claims matched economist estimates.

The modest decline came after jobless claims reached their highest level since the week ended June 11th in the previous week.

Sector News

Electronic storage stocks have come under pressure over the course of the trading session, dragging the NYSE Arca Disk Drive Index down by 1.3 percent.

Nimble Storage (NMBL) and Micron Technology (MU) are turning in two of the storage sector's worst performances, with both falling by 2.6 percent.

Significant weakness has also emerged among banking stocks, as reflected by the 1.2 percent drop by the Dow Jones Banks Index. The index is pulling back further off the eight-year closing high it set on Tuesday.

Brokerage and semiconductor stocks have also shown notable moves to the downside, while substantial strength remains visible among gold stocks.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in another mixed performance on Thursday. Japan's Nikkei 225 Index slumped by 1.3 percent, while Hong Kong's Hang Seng Index edged up by 0.2 percent.

The major European markets also ended the day mixed. While the U.K.'s FTSE 100 Index crept up by 0.2 percent, the French CAC 40 Index and the German DAX Index both dipped by 0.2 percent.

In the bond market, treasuries are seeing further upside following the notable strength seen in the previous session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 2 basis points at 2.486 percent.