Stocks Close Modestly Higher Ahead Of Monthly Jobs Report - U.S. Commentary

(RTTNews) - Stocks moved modestly higher during trading on Thursday, regaining some ground after moving notably lower over the course of the two previous sessions. Buying interest was somewhat subdued, however, limiting the upside for the markets.

The major averages ended the day in positive territory but off their highs for the session. The Dow edged up 38.82 points or 0.2 percent to 18,135.72, the Nasdaq rose 15.67 points or 0.3 percent to 4,982.81 and the S&P 500 inched up 2.51 points or 0.1 percent to 2,101.04.

A positive reaction to news out of Europe contributed to the modest strength on Wall Street, as the European Central Bank provided additional details about its quantitative easing program.

ECB President Mario Draghi revealed that the bank will purchase $66.3 billion worth of bonds each month beginning on March 9th.

The central bank previously indicated that the $1.1 trillion asset purchase program is expected to continue until September of 2016.

Following its monetary policy meeting, the ECB also raised its forecast for European economic growth in 2015 to 1.5 percent from 1 percent.

Nonetheless, traders seemed somewhat reluctant to make any significant moves ahead of the release of the Labor Department's closely watched monthly jobs report on Friday.

Economists currently expect the report to show an increase of about 230,000 jobs in February, pushing the unemployment rate down to 5.6 percent.

Tomorrow's monthly jobs report will be the last released before the Federal Reserve's monetary policy announcement later this month and could have a significant impact on the central bank's outlook.

With the focus on the monthly data, traders largely shrugged off a report from the Labor Department showing an unexpected increase in weekly jobless claims.

The Labor Department said initial jobless claims rose to 320,000 in the week ended February 28th from the previous week's unrevised level of 313,000. The increase came as a surprise to economists, who had expected initial jobless claims to drop to 295,000.

With the unexpected increase, jobless claims rose to their highest level since reaching 327,000 in the week ended May 17, 2014.

Sector News

Despite the upward move shown by the broader markets, most of the major sectors ended the day showing only modest moves.

Biotechnology stocks saw significant strength, however, with the NYSE Arca Biotechnology Index surging up by 2.3 percent. With the gain, the index reached a new record closing high.

Pharmacyclics (PCYC) helped to lead the biotech sector higher, with biopharmaceutical company jumping by 10.3 percent after agreeing to be acquired by AbbVie (ABBV) for $21 billion.

Brokerage, utilities, and retail stocks also moved to the upside on the day, while some weakness was visible among energy stocks.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Thursday. Japan's Nikkei 225 Index rose by 0.3 percent, while Hong Kong's Hang Seng Index slumped by 1.1 percent.

Meanwhile, the major European markets all moved to the upside on the day. While the U.K.'s FTSE 100 Index climbed by 0.6 percent, the French CAC 40 Index and the German DAX Index advanced by 0.9 percent and 1 percent, respectively.

In the bond market, treasuries showed a lack of direction throughout the session before closing modestly higher. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by 1.1 basis points to 2.112 percent.

Looking Ahead

The monthly jobs report is likely to be in focus on Friday, although traders will also be presented with reports on the U.S. trade deficit and consumer credit.