Stocks Close Mostly Higher Following Upbeat Jobs Data - U.S. Commentary

(RTTNews) - While trading activity was somewhat subdued, stocks moved mostly higher over the course of the day trading on Thursday. The markets extended a recent upward trend, benefiting from a positive reaction to upbeat jobs data.

The major averages all ended the day in positive territory, with the Dow and the S&P 500 reaching new record closing highs. The Dow jumped 122.33 points or 0.8 percent to 16,479.88, the Nasdaq rose 11.76 points or 0.3 percent to 4,167.18 and the S&P 500 climbed 8.70 points or 0.5 percent to 1,842.02.

Optimism about the outlook for the economy contributed to the strength on Wall Street following the release of a report from the Labor Department showing a steep drop in weekly jobless claims in the week ended December 21st.

The Labor Department said initial jobless claims tumbled to 338,000, a decrease of 42,000 from the previous week's revised figure of 380,000. Economists had expected claims to drop to 340,000 from the 379,000 originally reported for the previous week.

The notable decrease partly offset the sharp jump seen in the first week of December, reflecting the volatility typically seen during the holiday season.

The data extended a recent string of positive reports that have generated optimism that the economic momentum is strong enough to withstand the Federal Reserve's recently announced decision to begin scaling back its stimulus program.

Nonetheless, trading volume was well below average, as many traders remained away from their desks following the Christmas Day holiday on Wednesday.

Most of the major sectors ended the day showing only modest moves, although some strength was visible among telecom, oil, and defense stocks.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Thursday, with several major markets closed for public holidays. Japan's Nikkei 225 Index advanced by 1 percent, while China's Shanghai Composite Index tumbled by 1.6 percent.

Meanwhile, the major European markets remained closed throughout the day on account of the Boxing Day holiday.

In the bond market, treasuries ended the day slightly higher, extending the downward move seen over the two previous sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, edged up by less than a basis point to 2.99 percent.

Following today's below average volume, trading activity could be even lighter on Friday amid a lack of major U.S. economic data.