Major Averages Near The Unchanged Line In Morning Trading - U.S. Commentary

(RTTNews) - Stocks are showing a lack of direction in morning trading on Thursday following the mixed performance seen in the previous session. The major averages have spent the morning bouncing back and forth across the unchanged line.

Currently, the major averages are posting modest gains. The Dow is up 19.93 points or 0.1 percent at 21,429.96, the Nasdaq is up 3.15 points or 0.1 percent at 6,237.10 and the S&P 500 is up 1.57 points or 0.1 percent at 2,437.18.

The choppy trading on Wall Street comes as traders continue to express uncertainty about the near-term outlook for the markets following the recent move to record highs by the Dow and the S&P 500.

On the U.S. economic front, the Labor Department released a report before the start of trading showing a modest uptick in first-time claims for unemployment benefits in the week ended June 17th.

The report said initial jobless claims inched up to 241,000, an increase of 3,000 from the previous week's revised level of 238,000. Economists had expected jobless claims to edge up to 240,000.

A separate report from the Conference Board showed that its index of leading economic indicators rose in line with economist estimates in the month of May.

The Conference Board said its leading economic index climbed by 0.3 percent in May after rising by a downwardly revised 0.2 percent in April.

Ataman Ozyildirim, Director of Business Cycles and Growth Research at the Conference Board, said the continued upward trend by the index suggests the economy is likely to "remain on, or perhaps even moderately above, its long-term trend of about 2 percent growth for the remainder of the year."

Most of the major sectors are showing only modest moves on the day, although considerable strength has emerged among gold stocks. The NYSE Arca Gold Bugs Index is up by 1.8 percent, continuing to rebound after ending Tuesday's trading at its lowest closing level in over a month.

The strength among gold stocks comes amid an increase by the price of the precious metal, with gold for August delivery climbing $6.40 to $1,252.20 an ounce.

Drug stocks have also shown a strong move to the upside, driving the NYSE Arca Pharmaceutical Index up by 1.5 percent to its best intraday level in almost a year.

Within the pharmaceutical sector, Novartis (NVS) is posting a standout gain after trial results revealed its Canakinumab reduces the risk of major adverse cardiovascular events in patients with a prior heart attack.

Biotechnology and software stocks are also seeing notable strength in morning trading, while banking and tobacco stocks have moved to the downside.

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 Australia's All Ordinaries Index climbed by 0.7 percent.

Meanwhile, European stocks are seeing modest weakness on the day. While the German DAX Index has dipped by 0.1 percent, the French CAC 40 Index is down by 0.2 percent and the U.K.'s FTSE 100 Index is down by 0.3 percent.

In the bond market, treasuries have pulled back near the unchanged line after seeing early strength. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by less than a basis point at 2.160 percent.