Stocks Manage Gains In Another Lackluster Session - U.S. Commentary

(RTTNews) - Stocks turned in another lackluster performance during trading on Thursday, extending the trend seen over the past few sessions. The major averages eventually ended the day on the upside.

While the major averages all closed in positive territory, the Nasdaq outperformed its counterparts. The Nasdaq advanced 25.59 points or 0.7 percent to 3,605.19, while the Dow edged up 13.37 points or 0.1 percent to 15,555.61 and the S&P 500 rose 4.31 points or 0.3 percent to 1,690.25.

The Nasdaq benefited from a substantial advance by shares of Facebook (FB), which surged up by 29.6 percent to their best levels since the days after their IPO.

The rally by Facebook came after the social networking giant reported better than expected second quarter results after the close of trading on Wednesday. The lackluster performance turned in by the broader markets came as the latest batch of earnings news tugged stocks in opposite directions along with the release of a mixed batch of economic data.

Traders were digesting quarterly results from a number of big-name companies, including General Motors (GM), 3M (MMM), Dow Chemical (DOW), and Hershey (HSY).

On the economic front, the Commerce Department released a report showing a bigger than expected increase in durable goods orders in June, although the growth was largely due to a substantial increase in orders for transportation equipment.

The report said durable goods orders surged up by 4.2 percent in June following an upwardly revised 5.2 percent jump in May. Economists had expected orders to rise by 1.5 percent.

Excluding the 12.8 percent jump in orders for transportation equipment, however, durable goods orders were unchanged in June compared to a 1.0 percent increase in May.

Separately, the Labor Department released a report showing that initial jobless claims rose by slightly more than expected in the week ended July 20th.

The report said initial jobless claims rose to 343,000, an increase of 7,000 from the previous week's revised figure of 336,000. Economists had been expecting jobless claims to climb to 341,000 from the 334,000 originally reported for the previous week.

Sector News

While many of the major sectors ended the session show only modest moves, natural gas stocks showed a strong move to the upside on the day. Reflecting the strength in the sector, the NYSE Arca Natural Gas Index advanced by 1.9 percent.

Southwestern Energy (SWN) helped to lead the natural gas sector higher, surging up by 5.1 percent to a two-month closing high.

Considerable strength also emerged among internet stocks, as reflected by the 1.6 percent gain posted by the NYSE Arca Internet Index. Baidu (BIDU) posted a standout gain after reporting better than expected second quarter results.

Networking, tobacco, and gold stocks also saw notable strength on the day, with gold stocks moving higher along with the price of the precious metal.

Meanwhile, substantial weakness remained visible among housing stocks, resulting in a 2.5 percent drop by the Philadelphia Housing Sector Index. PulteGroup (PHM) helped lead the housing sector lower, with the homebuilder tumbling by 10.3 percent after reporting weaker than expected second quarter earnings.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved to the downside during trading on Thursday. Japan's Nikkei 225 Index dropped by 1.1 percent, while Hong Kong's Hang Seng Index ended the day down by 0.3 percent.

The major European markets also came under pressure on the day. While the German DAX Index slid by 1 percent, the U.K.'s FTSE 100 Index fell by 0.5 percent and the French CAC 40 Index edged down by 0.2 percent.

In the bond market, treasuries closed modestly lower, extending the pullback seen over the past few days. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose by 1.9 basis points to 2.607 percent.

Looking Ahead

The economic calendar for Friday is relatively quiet, although Thomson Reuters and the University of Michigan are scheduled to release their revised report on July consumer sentiment.

On the earnings front, Amazon (AMZN), Starbucks (SBUX), and Expedia (EXPE) are among the companies releasing their quarterly results after the close of today's trading.

Tyco International (TYC), Weyerhaeuser (WY), and Newell Rubbermaid (NWL) are among the companies due to report their results before the start of trading on Friday.