Stocks Move Modestly Lower In Early Trading - U.S. Commentary

(RTTNews) - Stocks have moved moderately lower in early trading on Thursday, giving back some ground after ending the previous session mostly higher. The major averages have slid into negative territory, although selling pressure has remained somewhat subdued.

In recent trading, the major averages have climbed off their lows for the young session, but they currently remain in the red. The Dow is down 21.86 points or 0.1 percent at 18,090.75, the Nasdaq is down 10.84 points or 0.2 percent at 5,000.18 and the S&P 500 is down 3.80 points or 0.2 percent at 2,102.83.

The early weakness on Wall Street may be partly due to profit taking following the upward trend seen throughout early April.

With the gains posted on Wednesday, the major averages ended the session at their best closing levels in almost a month.

Another batch of disappointing economic data is also weighing on the markets, with a report from the Commerce Department showing a much smaller than expected rebound in housing starts.

While the report said housing starts rose 2.0 percent to an annual rate of 926,000 in March, economists had been expecting starts to jump to a rate of 1.04 million.

The Commerce Department also said building permits, an indicator of future housing demand, fell 5.7 percent to an annual rate of 1.039 million in March.

A separate report from the Labor Department showed an unexpected increase in weekly jobless claims, although the Philadelphia Federal Reserve said its index of regional manufacturing index rose by more than expected.

Oil service stocks are seeing considerable weakness in early trading after seeing substantial strength in the previous session. The Philadelphia Oil Service Index is falling by 2.2 percent after ending Wednesday's trading at its best closing level in well over four months.

The pullback by oil service stocks comes amid a decrease by the price of crude oil, with crude for May delivery sliding $0.76 to $55.63 a barrel.

Notable weakness has also emerged among housing stocks, which are under pressure following the disappointing housing starts data. Reflecting the weakness in the sector, the Philadelphia Housing Sector Index is down by 1.3 percent.

Gold, electronic storage and utilities stocks are also seeing early weakness, while some strength is visible among tobacco and airline stocks.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Thursday. Japan's Nikkei 225 Index inched up by 0.1 percent, while Hong Kong's Hang Seng Index rose by 0.4 percent.

Meanwhile, the major European markets have all come under pressure on the day. While the German DAX Index has slumped by 1.7 percent, the French CAC 40 Index and the U.K.'s FTSE 100 Index are down by 0.6 percent and 0.4 percent, respectively.

In the bond market, treasuries have pulled back following the release of the Philly Fed data. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 1.6 basis points at 1.916 percent.