Stocks Close Higher For Sixth Consecutive Session - U.S. Commentary

(RTTNews) - Stocks moved mostly higher over the course of the trading day on Thursday, extending their recent winning streak to six sessions. With the continued upward move, the Nasdaq and the S&P 500 reached new record closing highs.

The major averages ended the day firmly in positive territory. The Dow rose 70.53 points or 0.3 percent to 21,082.95, the Nasdaq advanced 42.23 points or 0.7 percent to 6,205.26 and the S&P 500 climbed 10.68 points or 0.4 percent to 2,415.07.

The continued strength on Wall Street was partly due to upbeat earnings news from some big-name retailers, which helped offset some recent concerns about consumer spending.

Electronics retailer Best Buy (BBY) also showed a substantial move to the upside after reporting first quarter results that beat expectations on both the top and bottom lines.

Shares of Sears (SHLD) also saw significant strength after the department store operator reported a narrower than expected first quarter loss on revenues that exceeded estimates.

Traders also continued to respond positively to the minutes of the Federal Reserve's latest monetary policy meeting, which included an outline of a plan to trim its $4.5 trillion balance sheet.

Nearly all policymakers expressed a favorable view of the approach, which was seen as consistent with the intention to reduce the Fed's securities holdings in a gradual and predictable manner.

Under the proposed approach, the Fed would announce a set of gradually increasing caps on the dollar amounts of Treasury and agency securities that would be allowed to run off each month.

Only the amounts of securities repayments that exceeded the caps would be reinvested each month, the minutes said.

In U.S. economic news, a report released by the Labor Department showed a slight uptick in first-time claims for unemployment benefits in the week ended May 20th.

The report said initial jobless claims inched up to 234,000, an increase of 1,000 from the previous week's revised level of 233,000. Economists had expected jobless claims to climb to 238,000.

Sector News

Electronic storage stocks showed a strong move to the upside on the day, driving the NYSE Arca Disk Drive Index up by 2.2 percent. With the jump, the index reached its best closing level in well over a year.

NetApp (NTAP) helped to lead the storage sector higher after the data services company reported better than expected fourth quarter results.

Considerable strength was also visible among transportation stocks, as reflected by the 1.6 percent advance by the Dow Jones Transportation Average. Norfolk Southern (NSC) and United Continental (UAL) posted notable gains.

Retail, software, and internet stocks also saw significant strength on the day, contributing to the higher close by the broader markets.

On the other hand, energy stocks moved substantially lower amid a steep drop by the price of crude oil. Crude for July delivery plunged $2.46 to $48.90 a barrel.

While OPEC agreed to extend a cut in production until March of 2018, investors had been hoping the cartel would announce a further reduction in output.

Oil service stocks showed a particularly sharp decline, dragging the Philadelphia Oil Service Index down by 5.4 percent. The index tumbled to its lowest closing level in over a year.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Thursday. Japan's Nikkei 225 Index rose by 0.4 percent, while China's Shanghai Composite Index jumped by 1.4 percent.

Meanwhile, the major European markets turned in a relatively lackluster performance on the day. While the U.K.'s FTSE 100 Index closed just above the unchanged line, the French CAC 40 Index edged down by 0.1 percent and the German DAX Index dipped by 0.2 percent.

In the bond market, treasuries closed modestly higher amid the steep drop in crude oil prices. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by 1.1 basis points to 2.255 percent.

Looking Ahead

Economic data may attract attention on Friday, with traders likely to keep an eye on reports on fist quarter GDP, durable goods orders, and consumer sentiment.

On the earnings front, Costco (COST) and GameStop (GME) are among the companies releasing their quarterly results after the close of today's trading.