Stocks Move Mostly Higher, Nasdaq Sets Record Closing High - U.S. Commentary

(RTTNews) - Stocks moved mostly higher during trading on Thursday, adding to the gains posted in the two previous sessions. With the upward move on the day, the tech-heavy Nasdaq reached a new record closing high.

The major averages ended the day firmly in positive territory. The Dow rose 59.92 points or 0.3 percent to 21,952.35, the Nasdaq jumped 60.35 points or 1 percent to 6,428.66 and the S&P 500 climbed 14.02 points or 0.6 percent to 2,471.61.

The strength on Wall Street came following the release of a slew of U.S. economic data, including a Commerce Department report showing a bigger than expected increase in personal income.

The Commerce Department said personal income climbed by 0.4 percent in July after coming in unchanged in June. Economists had expected income to rise by 0.3 percent.

Meanwhile, the report said personal spending rose by 0.3 percent in July after edging up by 0.2 percent in the previous month. Spending had been expected to increase by 0.4 percent.

The Labor Department released a separate report showing first-time claims for U.S. unemployment benefits edged slightly higher in the week ended August 26th.

The report said initial jobless claims inched up to 236,000, an increase of 1,000 from the previous week's revised level of 235,000.

Economists had expected jobless claims to rise to 237,000 from the 234,000 originally reported for the previous week.

MNI Indicators also released a report showing continued growth in Chicago-area business activity in the month of August.

The Chicago business barometer came in at 58.9 in August, unchanged from July. A reading above 50 indicates growth. Economists had expected the barometer to edge down to 58.5.

A separate report from the National Association of Realtors showed an unexpected decrease in pending home sales in the month of July.

NAR said its pending home sales index fell by 0.8 percent to 109.1 in July from a downwardly revised 110.0 in June. Economists had expected pending home sales to rise by 0.5 percent.

A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.

Sector News

Biotechnology stocks showed a substantial move to the upside on the day, driving the NYSE Arca Biotechnology Index up by 2.6 percent. The jump lifted the index to its best closing level in over two years.

Impax Laboratories (IPXL), Newlink Genetics (NLNK), and Cara Therapeutics (CARA) turned in some of the biotech sector's best performances.

Significant strength was also visible among gold stocks, as reflected by the 2 percent gain posted by the NYSE Arca Gold Bugs Index. The strength in the sector came as gold for December delivery climbed $8.10 to $1,322.20 an ounce.

Natural gas, healthcare, housing, and internet stocks also saw notable strength, while trucking stocks were among the few groups to buck the uptrend.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Thursday. Japan's Nikkei 225 Index advanced by 0.7 percent, while Hong Kong's Hang Seng Index fell by 0.4 percent.

Meanwhile, the major European markets all moved to the upside on the day. While the U.K.'s FTSE 100 Index climbed by 0.9 percent, the French CAC 40 Index and the German DAX Index rose by 0.6 percent and 0.4 percent, respectively.

In the bond market, treasuries saw some strength after ending the previous session slightly lower. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 2.2 basis points to 2.121 percent.

Looking Ahead

Trading on Friday is likely to be impacted by reaction to the Labor Department's monthly jobs report. The report is expected to show an increase of about 180,000 jobs in August.

The closely watched monthly jobs report may overshadow data on manufacturing activity, construction spending, and consumer sentiment.