Dow Reaches Record Closing High But Nasdaq Pulls Back - U.S. Commentary

(RTTNews) - Following the broad based rally seen in the previous session, stocks turned in a mixed performance during trading on Thursday. While the Dow advanced to a new record closing high, the tech-heavy Nasdaq ended the day firmly in negative territory.

The Dow jumped 218.19 points or 1.2 percent to 18,807.88 and the S&P 500 rose 4.22 points or 0.2 percent to 2,167.48, but the Nasdaq slid 42.28 points or 0.8 percent to 5,208.80.

The jump by the Dow was partly due to substantial gains by JPMorgan (JPM) and Goldman (GS), which was indicative of strength throughout the financial sector amid optimism about reduced regulation under Trump.

Reflecting the strength in the financial sector, the Dow Jones Banks Index soared by 4.7 percent and the NYSE Arca Broker/Dealer Index shot up by 3.7 percent.

Dow component Pfizer (PFE) also posted a standout gain after a report from Reuters said the drug giant is evaluating a potential sale or spin-off of its consumer health division that could value the unit at as much as $14 billion.

Along with financial stocks, biotechnology, oil service, transportation, and steel stocks also added to recent gains amid optimism they will benefit in the new Trump administration.

Meanwhile, Apple (AAPL) and Microsoft (MSFT) posted notable losses on the day, weighing on the tech-heavy Nasdaq.

Gold stocks also came under pressure, dragging the NYSE Arca Gold Bugs Index down by 7.8 percent. The weakness in the sector came as the price of gold for December delivery slid $7.10 to $1,266.40 an ounce.

Significant weakness was also visible among utilities stocks, which have fallen sharply along with treasuries following Trump's upset victory.

Semiconductor, software, internet and stocks also showed notable declines, reflecting overall weakness in the tech sector.

On the U.S. economic front, the Labor Department released a report before the start of trading showing a bigger than expected drop in initial jobless claims in the week ended November 5th.

The report said initial jobless claims fell to 254,000, a decrease of 11,000 from the previous week's unrevised level of 265,000. Economists had expected jobless claims to edge down to 263,000.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region saw substantial strength during trading on Thursday. Japan's Nikkei 225 Index soared by 6.7 percent, while Hong Kong's Hang Seng Index jumped by 1.9 percent.

Meanwhile, the major European markets moved to the downside over the course of the session. While the U.K.'s FTSE 100 Index slumped by 1.2 percent, the French CAC 40 Index and the German DAX Index dipped by 0.3 percent and 0.2 percent, respectively.

In the bond market, treasuries extended the sell-off that was seen in the previous session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose by 4.5 basis points to a new ten-month closing high of 2.117 percent.

Looking Ahead

Trading activity on Friday may be somewhat subdued due to the Veterans Day holiday, although investors may react to a report on consumer sentiment as well as a speech by Federal Reserve Vice Chairman Stanley Fischer.

On the earnings front, entertainment giant Disney (DIS) is among the companies releasing their quarterly results after the close of today's trading.