Stocks Regain Ground After Seeing Initial Weakness - U.S. Commentary

(RTTNews) - After coming under pressure at the open, stocks have regained some ground in early trading on Thursday. The major averages have bounced well off their lows for the young session, with the Nasdaq climbing into positive territory.

Currently, the major averages are turning in a mixed performance, as the Nasdaq is posting a modest gain. While the Nasdaq is up 1.59 points or less than 0.1 percent at 4,202.87, the Dow is down 34.22 points or 0.2 percent at 15,929.72 and the S&P 500 is down 2.67 points or 0.2 percent at 1,816.59.

The initial weakness on Wall Street was partly in reaction to disappointing U.S. economic data, including a report from the Commerce Department showing an unexpected drop in retail sales in January.

The report said retail sales fell by 0.4 percent in January following a revised 0.1 percent decrease in December. Economists had expected sales to come in unchanged compared to the 0.2 percent increase originally reported for the previous month.

Excluding a steep drop in auto sales, retail sales came in unchanged in January compared to a downwardly revised 0.3 percent increase in December.

A separate report from the Labor Department showed that initial jobless claims unexpectedly saw a modest increase in the week ended February 8th.

The Labor Department said initial jobless claims rose to 339,000, an increase of 8,000 from the previous week's unrevised figure of 331,000. The modest increase came as a surprise to economists, who had expected initial jobless claims to edge down to 330,000.

Selling pressure waned not long after the open, however, and stocks have subsequently climbed well off their worst levels.

Gold stocks have shown a substantial move to the upside in early trading after ending the previous session sharply lower. The NYSE Arca Gold Bugs Index has surged up by 2 percent, partly offsetting Wednesday's 2.8 percent drop.

Most of the other major sectors are showing only modest moves, contributing to another relatively lackluster performance by the broader markets.

Among individual stocks, shares of Time Warner Cable (TWC) have moved sharply higher after the company agreed to be acquired by rival Comcast (CMCSA) for approximately $45.2 billion.

Tire maker Goodyear (GT) is also turning in a strong performance after reporting better than expected fourth quarter earnings.

On the other hand, shares of Whole Foods (WFM) have fallen sharply after the grocery chain reported first quarter results that came in below analyst estimates and cuts its full-year guidance.

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Thursday. Japan's Nikkei 225 Index tumbled by 1.8 percent, while Hong Kong's Hang Seng Index ended the day down by 0.5 percent.

The major European markets have also moved to the downside on the day. While the U.K.'s FTSE 100 Index has dropped by 0.8 percent, the French CAC 40 Index and the German DAX Index are down by 0.4 percent and 0.2 percent, respectively.

In the bond market, treasuries have moved modestly higher on the heels of the disappointing economic data. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 2.2 basis points at 2.741 percent.