Stocks Close Roughly Flat Ahead Of Monthly Jobs Data - U.S. Commentary

(RTTNews) - After recovering from an early move to the upside, stocks turned in a lackluster performance over the course of the trading session on Thursday. The major averages spent much of the day lingering near the unchanged line before closing mixed.

While the Dow inched up 1.04 points or 0.1 percent to 2,160.77, the Dow edged down 12.53 points or 0.1 percent to 18,268.50 and the Nasdaq dipped 9.17 points or 0.2 percent to 5,306.85.

The choppy trading seen for much of the day came as traders looked ahead to the release of the Labor Department's closely watched monthly jobs report on Friday.

Employment is expected to increase by 168,000 jobs in September after climbing by 151,000 jobs in August. The unemployment rate is expected to hold at 4.9 percent.

The strength of the jobs data could impact the outlook for monetary policy, although the Federal Reserve is widely expected to leave interest rates unchanged at its next meeting in November.

Before the trading start of trading, the Labor Department released a report unexpectedly showing a modest drop in initial jobless claims in the week ended October 1st.

The report said initial jobless claims fell to 249,000, a decrease of 5,000 from the previous week's unrevised level of 254,000. The modest decline came as a surprise to economists, who had expected jobless claims to inch up to 256,000.

With the unexpected decrease, jobless claims fell to their lowest level since hitting a more than four decade low in mid-April.

Sector News

While most of the major sectors ended the day showing only modest moves, significant weakness was visible among biotechnology stocks. The NYSE Arca Biotechnology Index tumbled by 3.3 percent to its lowest closing level in a month.

Alnylam Pharmaceuticals (ALNY) led the biotech sector lower after the biopharmaceutical company decided to discontinue development of revusiran to treat a genetic condition that can cause heart failure.

Gold stocks also saw notable weakness, dragging the NYSE Arca Gold Bugs Index down by 2.9 percent. With the drop, the index fell to a four-month closing low.

The weakness among gold stocks came amid a notable decrease by the price of the precious metal, with gold for December delivery sliding $15.60 to $1,253 an ounce.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Thursday. Japan's Nikkei 225 Index climbed by 0.5 percent, while Hong Kong's Hang Seng Index advanced by 0.7 percent.

Meanwhile, the major European markets moved lower on the day. While the U.K.'s FTSE 100 Index fell by 0.5 percent, the French CAC 40 Index and the German DAX Index both edged down by 0.2 percent.

In the bond market, treasuries showed a lack of direction as the day progressed before closing moderately lower. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, rose by 2.6 basis points to a four-month closing high of 1.742 percent.

Looking Ahead

While the monthly jobs report is likely to be in the spotlight on Friday, trading could also be impacted by reaction to speeches from several Federal Reserve officials.