Stocks Finish Choppy Trading Session Modestly Higher - U.S. Commentary

(RTTNews) - Stocks turned in a relatively lackluster performance during trading on Thursday before ending the session modestly higher. The choppy trading came on the heels of the substantial volatility that was seen in the previous session.

The major averages all managed to finish the session in positive territory. The Dow climbed 79.92 points or 0.5 percent to 16,416.58, the Nasdaq edged up 5.32 points or 0.1 percent to 4,509.56 and the S&P 500 rose 2.92 points or 0.2 percent to 1,915.45.

The lack of direction seen for much of the day came as traders kept a close eye on the price of crude oil, which showed some wild swings as the day progressed.

Crude for March delivery eventually finished the session down $0.56 at $31.72 a barrel after reaching a high of $33.60 a barrel.

Traders may also have been reluctant to make any significant moves ahead of the release of the Labor Department's monthly jobs report on Friday.

Employment is expected to increase by about 188,000 jobs in January after jumping by 292,000 jobs in December. The unemployment rate is expected to hold at 5.0 percent.

Before the start of today's trading, the Labor Department released a report showing that initial jobless claims rose more than expected in the week ended January 30th.

The report said initial jobless claims climbed to 285,000, an increase of 8,000 from the previous week's revised level of 277,000. Economist had expected jobless claims to inch up to 280,000.

A separate report from the Labor Department showed that labor productivity fell by more than anticipated in the fourth quarter.

The report said labor productivity dropped by 3.0 percent in the fourth quarter after climbing by 2.1 percent in the third quarter. Economists had expected productivity to decline by 1.8 percent.

Meanwhile, the Labor Department also said unit labor costs jumped by 4.5 percent in the fourth quarter following a 1.9 percent increase in the third quarter. Costs had been expected to rise by 4.4 percent.

The Commerce Department also released a report showing that factory orders tumbled by 2.9 percent in December amid a sharp drop in durable goods orders.

Sector News

Despite the lackluster performance by the broader markets, steel stocks moved sharply higher on the day. The NYSE Arca Steel Index soared by 6.7 percent to its best closing level in a month.

Gerdau (GGB), Allegheny Technologies (ATI), and Carpenter Technology (CRS) turned in some of the steel sector's best performances.

Substantial strength was also visible among gold stocks, as reflected by the 5.5 percent gain posted by the NYSE Arca Gold Bugs Index. The strength in the sector came as gold for April delivery climbed $16.20 to $1,157.50 an ounce.

Electronic storage, transportation, and oil service stocks also saw considerable strength on the day, while pharmaceutical stocks showed a notable move to the downside.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher on Thursday. Hong Kong's Hang Seng Index advanced by 1 percent, while China's Shanghai Composite Index jumped by 1.5 percent. However, Japan's Nikkei 225 Index bucked the uptrend and fell by 0.9 percent.

Meanwhile, the major European markets turned in a mixed performance on the day. While the U.K.'s FTSE 100 Index surged up by 1.1 percent, the French CAC 40 Index tumbled by 1.3 percent and the German DAX Index dropped by 0.4 percent.

In the bond market, treasuries closed modestly higher following a relatively lackluster session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by 1.7 basis points to 1.864 percent.

Looking Ahead

The monthly jobs report is likely to be in the spotlight on Friday, overshadowing a separate report on the U.S. trade deficit.