U.S. Stocks Give Back Ground After Reaching New Record Highs

(RTTNews) - After moving notably higher early in the session, stocks have given back some ground over the course of morning trading on Thursday. The major averages have pulled back off their new record highs but remain in positive territory.

Currently, the major averages are holding on to moderate gains. The Dow is up 128.06 points or 0.5 percent at 28,666.50, the Nasdaq is up 46.72 points or 0.5 percent at 9,019.32 and the S&P 500 is up 8.34 points or 0.3 percent at 3,239.12.

The early strength on the first trading day of 2020 came as stocks looked to extend the strong upward move seen last year.

Stocks continued to ride the upward momentum that helped the major averages continually reach new record highs in the latter part of 2019.

Optimism about the potential impact of a phase one U.S.-China trade deal generated continued buying interest, with President Donald Trump saying the deal is due to be signed during a White House ceremony on January 15th.

Trump said in a post on Twitter on Tuesday that he would travel to Beijing at a later date to begin talks on phase two of a trade agreement.

Recent reports have indicated Chinese Vice Premier Liu He, Beijing's top trade negotiator, will be on hand to sign the phase one deal.

The U.S. economy has held up relatively well in the face of the U.S.-China trade war, and the signing of the phase one deal could lift some of the uncertainty hanging over some industries.

However, traders continue to wait for more details about the deal and remain wary as significant tariffs will remain in place even after the agreement is signed.

In U.S. economic news, the Labor Department released a report showing initial jobless claims unexpectedly edged slightly lower from an upwardly revised level in the week ended December 28th.

The report said initial jobless claims slipped to 222,000, a decrease of 2,000 from the previous week's revised level of 224,000.

Economists had expected jobless claims to inch up to 225,000 from the 222,000 originally reported for the previous week.

Meanwhile, the Labor Department said the less volatile four-week moving average crept up to its highest level since January of 2018.

Gold stocks have shown a strong move to the upside in morning trading, driving the NYSE Arca Gold Bugs Index up by 1.1 percent.

The strength among gold stocks comes amid a notable increase by the price of the precious metal, as gold for February delivery is climbing $9.30 to $1,532.40 an ounce.

Software, semiconductor and computer hardware stocks are also seeing notable strength, while natural gas, tobacco and biotechnology stocks have moved to the downside.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher on Thursday, with the Japanese markets still closed for New Year's. China's Shanghai Composite Index jumped by 1.2 percent, while Hong Kong's Hang Seng Index surged up by 1.3 percent.

The major European markets have also moved to the upside on the day. While the U.K.'s FTSE 100 Index is up by 0.8 percent, the German DAX Index and the French CAC 40 Index are up by 1.1 percent and 1.2 percent, respectively.

In the bond market, treasuries have moved notably higher over the course of the morning. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 6.5 basis points at 1.854 percent.