Bargain Hunting Contributes To Strength On Wall Street - U.S. Commentary

(RTTNews) - Stocks have moved mostly higher in morning trading on Thursday, regaining some ground following recent weakness. The major averages fluctuated early in the session but have climbed firmly into positive territory since then.

Currently, the major averages are just off their highs for the session. The Dow is up 155.12 points or 1 percent at 15,921.86, the Nasdaq is up 30.55 points or 0.7 percent at 4,502.24 and the S&P 500 is up 16.07 points or 0.9 percent at 1,875.40.

The strength that has emerged on Wall Street is partly due to bargain hunting, as traders pick up stocks at reduced levels following the recent sell-off.

The gains by the major averages come after they ended the previous session at their lowest closing levels in over a year.

Traders are also reacting to the latest monetary policy announcement from the European Central Bank, which left interest rates unchanged.

In his subsequent press conference, ECB President Mario Draghi noted downside risks have increased and said the bank would review and possibly reconsider its monetary policy stance at the next meeting in early March.

On the U.S. economic front, the Labor Department released a report before the start of trading showing an unexpected increase in initial jobless claims in the week ended January 16th.

The report said initial jobless claims climbed to 293,000, an increase of 10,000 from the previous week's revised level of 283,000.

The increase came as a surprise to economists, who had expected jobless claims to drop to 275,000 from the 284,000 originally reported for the previous week.

With the unexpected increase, jobless claims rose to their highest level since reaching 296,000 in the week ended July 4th.

A separate report from the Federal Reserve Bank of Philadelphia showed that manufacturing conditions in the Philadelphia region contracted modestly in January.

The Philly Fed said its diffusion index for current activity increased to a negative 3.5 in January from a negative 10.2 in December, although a negative reading indicates a contraction in regional manufacturing activity.

Energy stocks are seeing notable strength on the day amid an increase by the price of crude oil. Crude for March delivery is currently rising $0.20 to $28.55 a barrel.

Reflecting the strength in the energy sector, the NYSE Arca Natural Gas Index has surged up by 4.2 percent and the Philadelphia Oil Service Index has jumped by 2.3 percent.

Trucking, semiconductor, and airline stocks are also seeing considerable strength, while railroad and gold stocks have moved to the downside.

In overseas trading, most stock markets across the Asia-Pacific region saw considerable weakness during trading on Thursday. Japan's Nikkei 225 Index plunged by 2.4 percent, while Hong Kong's Hang Seng Index slumped by 1.8 percent.

Meanwhile, the major European markets have moved to the upside on the day. While the U.K.'s FTSE 100 Index has surged up by 1.4 percent, the German DAX Index and the French CAC 40 Index are both up by 1.6 percent.

In the bond market, treasuries are showing a lack of direction after moving notably higher in recent sessions. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by less than a basis point at 1.981 percent.