Christmas Cheer May Help Markets Extend Upward Trend

(RTTNews) - The major U.S. index futures are pointing to a modestly higher opening on Wednesday, with stocks poised to add to the gains posted over the past few sessions. The markets may benefit from a report showing an unexpected drop in jobless claims as well as the recent upward momentum. Nonetheless, trading activity may be somewhat subdued amid the holiday-shortened Christmas Eve session.

Stocks turned in a relatively lackluster performance during trading on Tuesday following the release of a mixed batch of U.S. economic data. Despite the choppy trading, the Dow closed above 18,000 for the first time and set a new record closing high along with the S&P 500.

The major averages ended the day on opposite sides of the unchanged line. While the Nasdaq fell 16.00 points or 0.3 percent to 4,765.42, the Dow climbed 64.73 points or 0.4 percent to 18,024.17 and the S&P 500 edged up 3.63 points or 0.2 percent to 2,082.17.

Early buying interest was generated by a report from the Commerce Department showing much stronger than previously estimated third quarter GDP growth. However, the department also released separate reports showing unexpected decreases in durable goods orders and new home sales.

Relatively light trading activity also contributed to the lackluster performance, as some traders got a head start on the holidays.

While many of the major sectors ended the day showing only modest moves, energy stocks saw significant strength amid a notable increase by the price of crude oil.

Financial, steel and software stocks also turned in strong performances, while considerable weakness was visible among biotechnology, healthcare and pharmaceutical stocks.

Commodity, Currency Markets

Crude oil futures are sliding $1.16 to $55.96 after jumping $1.86 to $57.12 a barrel on Tuesday. Gold futures are slipping $2.40 to $1,175.50 an ounce. In the previous session, gold fell $1.80 to $1,178 an ounce.

On the currency front, the U.S dollar is currently trading at 120.48 yen compared to the 120.69 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is valued at $1.2207 versus yesterday's $1.2172.

Asia

Asian stocks moved mostly higher on Wednesday due in part to the upbeat U.S. GDP data as well as the record highs for the Dow and the S&P 500.

Japanese stocks moved higher for a fifth consecutive session as trading resumed after a public holiday on Tuesday. The Nikkei 225 Index surged up 219.09 points or 1.24 percent to finish at 17,854.23.

Mitsui Chemicals, Dentsu, Tokyo Electron and Sony posted notable gains, while exporters also moved higher on the back of weaker yen

Japan's Parliament re-elected Shinzo Abe to serve another term as Prime Minister following his big victory in a December 14th snap election that was billed as a referendum on his economic growth blitz.

Australia's All Ordinaries Index also rose 13.10 points or 0.24 percent to 5,369.50, although investors largely refrained from making significant moves ahead of a long weekend. Defensive stocks were in demand, with Wesfarmers rising 0.9 percent.

While Hong Kong's Hang Seng Index inched up 15.65 points or 0.1 percent to 23,349.34, China's Shanghai Composite Index bucked the uptrend and tumbled 60.08 points or 1.98 percent to 2,972.53.

Banks, brokerages and insurance companies paced the declines in China amid speculation the government would take steps to cool the stock market.

In economic news, the Conference Board said its leading index for the Australian economy dipped 0.2 percent in October, falling for the third straight month.

Europe

The European markets are turning in a mixed performance in a shortened trading day, with several markets in the region closed for Christmas Eve.

While the U.K.'s FTSE 100 Index inched up by 0.2 percent, the French CAC 40 Index is down by 0.4 percent.

In London, Smith & Nephew jumped 7.7 percent amid reports of a takeover offer from U.S.-based Stryker Corp.

U.S. Economic Reports

First-time claims for U.S. unemployment benefits unexpectedly decreased in the week ended December 20th, according to a report released by the Labor Department on Wednesday.

The report said initial jobless claims fell to 280,000, a decrease of 9,000 from the previous week's unrevised level of 289,000.

The modest decrease came as a surprise to economists, who had expected jobless claims to inch up to 290,000.

Stocks in Focus

Shares of Cal-Maine Foods (CALM) may be in focus after the egg producer reported weaker than expected second quarter earnings. The company also warned about the potential impact of a law related to egg production standards and sales in California.

Norwegian Cruise Line Holdings (NCLH) said an engine room fire that took one of its ships out of service will reduce its fourth quarter and first quarter earnings by $0.05 per share. However, the company reiterated its adjusted full-year 2014 earnings guidance.

Novo Nordisk (NVO) announced that the FDA has approved its New Drug Application for Saxenda, the first once-daily human glucagon-like peptide-1 analogue for the treatment of obesity.

According to reports, Citigroup (C) plans to sell its long-standing Japanese retail banking operations to Sumitomo Mitsui Banking Corp. for about $330 million.