Stocks Showing A Lack Of Direction In Early Trading - U.S. Commentary

(RTTNews) - On the heels of the Bank of England's monetary policy decision, stocks have shown a lack of direction over the course of early trading on Thursday. The major averages have been bouncing back and forth across the unchanged line.

Currently, the major averages are turning in a mixed performance. While the Nasdaq is up 4.03 points or 0.1 percent at 5,163.76, the Dow is down 8.53 points or 0.1 percent at 18,346.47 and the S&P 500 is down 0.35 points or less than a tenth of a percent at 2,163.44.

The choppy trading on Wall Street comes following the BoE's announcement of its decision to reduce interest rates following Britain's vote to leave the European Union.

The BoE revealed that its Monetary Policy Committee voted unanimously to lower interest rates by 25 basis points to a record low 0.25 percent, marking the first rate cut in over seven years.

Noting that the exchange rate has fallen and the outlook for growth in the short to medium term has weakened markedly, the central bank also indicated that it could lower rates further.

The bank also introduced a package of measures designed to provide additional monetary stimulus, including a scheme to reinforce the pass-through of the rate cut.

In his subsequent press conference, BoE Governor Mark Carney said banks have "no excuse" not to pass on lower borrowing costs to customers.

Additionally, the BoE said it would purchase up to 10 billion pounds worth of corporate bonds and 60 billion pounds worth of U.K. government bonds.

The central bank also slashed its forecast for U.K. economic growth, saying it now expects the economy to grow by 0.8 just percent in 2017 compared to its previous forecast for 2.3 percent growth.

With the BoE decision now in the rear-view mirror, traders may be looking ahead to the Labor Department's monthly jobs report due to be released on Friday.

The report is expected to show an increase of about 185,000 jobs in July after employment jumped by 287,000 jobs in June. The unemployment rate is expected to edge down to 4.8 percent from 4.9 percent.

The Labor Department released a report before the start of trading showing an unexpected uptick in initial jobless claims in the week ended July 30th.

The report said initial jobless claims rose to 269,000, an increase of 3,000 from the previous week's unrevised level of 266,000. Economists had expected claims to edge down to 265,000.

A separate report from the Commerce Department showing that factory orders slumped by 1.5 percent in June compared to economist estimates for a 1.8 percent drop.

Most of the major sectors are showing only modest moves on the day, contributing to the lackluster performance by the broader markets.

Notable strength is visible among airline stocks, however, with Copa Airlines parent Copa Holdings (CPA) posting a standout gain after reporting better than expected second quarter earnings.

Gold stocks have also shown a strong move to the upside on the day, benefiting from an increase by the price of the precious metal.

In overseas trading, stock markets across the Asia-Pacific region moved to the upside during trading on Thursday. Japan's Nikkei 225 Index surged up by 1.1 percent, while Hong Kong's Hang Seng Index advanced by 0.4 percent.

The major European markets have also moved higher on the day. While the U.K.'s FTSE 100 Index has jumped by 1.6 percent, the French CAC 40 Index and the German DAX Index are up by 0.4 percent and 0.3 percent, respectively.

In the bond market, treasuries have climbed firmly into positive territory on the heels of the BoE decision. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 5.3 basis points at 1.489 percent.