Stocks Close Slightly Lower Following Choppy Trading Day - U.S. Commentary

(RTTNews) - Stocks fluctuated throughout much of the trading day on Thursday as traders weighed upbeat earnings news against some disappointing economic data. The major averages spent much of the session bouncing back and forth across the unchanged line before closing slightly lower.

While the major averages ended the day in the red, they were well off their lows for the session. The Dow dipped 6.84 points or less than a tenth of a percent to 18,105.77, the Nasdaq edged down 3.23 points or 0.1 percent to 5,007.79 and the S&P 500 slipped 1.64 points or 0.1 percent to 2,104.99.

The choppy trading seen on Wall Street may partly have reflected uncertainty about the near-term outlook for the markets following the upward move seen over the past two weeks.

With the gains posted in the previous session, the major averages ended the day at their best closing levels in almost a month.

Some early selling pressure was generated by a report from the Commerce Department showing a much smaller than expected rebound in housing starts.

While the report said housing starts rose 2.0 percent to an annual rate of 926,000 in March, economists had been expecting starts to jump to a rate of 1.04 million.

The Commerce Department also said building permits, an indicator of future housing demand, fell 5.7 percent to an annual rate of 1.039 million in March.

However, the negative sentiment was partly offset by a separate report from the Philadelphia Federal Reserve showing that its index of regional manufacturing activity rose more than expected in April.

Traders also reacted positively to upbeat earnings news from big-name companies such as Citigroup (C), Goldman Sachs (GS), and UnitedHealth (UNH).

Shares of Netflix (NFLX) showed a particularly strong upward move after the streaming video service provider said it added nearly 5 million new subscribers in the first quarter.

Dovish comments by a pair of Federal Reserve officials also helped push stocks higher in afternoon trading, although buying interest waned going into the close.

Sector News

Many of the major sectors ended the day showing only modest moves, contributing to the lackluster close by the broader markets.

Steel stocks saw significant weakness, however, with the NYSE Arca Steel Index tumbling by 1.8 percent. With the drop, the index gave back ground after ending the previous session at its best closing level in well over a month.

Notable weakness also remained visible among housing stocks, which moved lower on the heels of the disappointing housing starts data. Reflecting the weakness in the sector, the Philadelphia Housing Sector Index dropped by 1.5 percent.

Oil service and gold stocks also moved to the downside, although the weakness was partly offset by strength in the tobacco, internet, and airline sectors.

Philip Morris (PM) helped to lead the tobacco sector higher, surging up by 8.7 percent after reporting better than expected first quarter earnings and raising its full-year earnings guidance.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Thursday. Japan's Nikkei 225 Index inched up by 0.1 percent, while Hong Kong's Hang Seng Index rose by 0.4 percent.

Meanwhile, the major European markets all moved to the downside on the day. While the German DAX Index tumbled by 1.9 percent, the French CAC 40 Index and the U.K.'s FTSE 100 Index dropped by 0.6 percent and 0.5 percent, respectively.

In the bond market, treasuries fluctuated over the course of the trading session before closing modestly higher. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 2.2 basis points to 1.878 percent.

Looking Ahead

Another batch of economic data is scheduled to be released on Friday, including reports on consumer price inflation, consumer sentiment, and leading economic indicators.

On the earnings front, American Express (AXP), Advanced Micro Devices (AMD), and Mattel (MAT) are releasing their quarterly results after the close of today's trading.

General Electric (GE) and Honeywell (HON) will also join the earnings parade before the start of trading on Friday.