Following a substantial rally during Wednesday's session, stocks delivered a relatively subdued performance on Thursday, with major indices oscillating throughout the day before closing in the red.
The technology-focused Nasdaq ended notably down, impacted by a decline in Apple (AAPL) shares, falling 172.94 points or 0.9% to 19,338.29. Meanwhile, the Dow Jones Industrial Average and the S&P 500 experienced more modest losses. The Dow decreased by 68.42 points or 0.2% to 43,153.13, and the S&P 500 slipped by 12.57 points or 0.2% to 5,937.34.
The erratic trading on Wall Street occurred as investors reevaluated the short-term market outlook after Wednesday's rally, which marked the largest daily percentage gains in over two months. Additionally, market participants were digesting a range of U.S. economic data, including reports on weekly jobless claims, retail sales, and import prices.
The Labor Department reported a rise in initial jobless claims to 217,000 for the week ending January 11th, an increase of 14,000 from the prior week's adjusted figure of 203,000. Economists had anticipated claims to reach 210,000. This larger-than-expected increase followed jobless claims hitting their lowest point since February 17, 2024.
The Commerce Department's report indicated that U.S. retail sales increased less than expected in December, rising 0.4% after an upwardly revised 0.8% gain in November. Analysts had projected a 0.6% rise. Conversely, core retail sales, which exclude automobiles, gasoline, building materials, and food services, had a stronger performance, increasing by 0.7% in December following a 0.4% rise in November.
"December's retail sales were bolstered by a price-related boost in gasoline station sales, but underlying figures remained promising, with a broad-based control group demonstrating robust growth," explained Michael Pearce, Deputy Chief U.S. Economist at Oxford Economics.
After previously releasing a highly anticipated report on consumer price inflation, the Labor Department unveiled data showing import prices in the U.S. increased in line with expectations in December. Import prices inched up by 0.1%, consistent with the growth seen in November and October.
"December saw moderate import price increases, rounding off an encouraging week of inflation data, maintaining the Federal Reserve's course for potential rate cuts in the first half of this year," stated Matthew Martin, Senior U.S. Economist at Oxford Economics. He added, "Though the recent rise in global oil prices will influence fuel import prices and introduce some data volatility, the Fed is likely to disregard these temporary inflation spikes."
### Sector Overview
Reflecting the broader market's tepid performance, most sectors displayed only slight movements. However, interest rate-sensitive utilities and commercial real estate stocks exhibited notable strength, with the Dow Jones Utility Index and the Dow Jones U.S. Real Estate Index jumping by 2.3% and 2.2%, respectively.
Brokerage stocks continued to build on their strong performance from Wednesday, driving the NYSE Arca Broker/Dealer Index up by 1.7% to its highest closing level in over a month. Natural gas and pharmaceutical stocks also displayed significant gains, while computer hardware and gold stocks showed some weakness.
### Global Markets
In international markets, Asian stock exchanges generally experienced gains on Thursday. Japan's Nikkei 225 Index rose by 0.3%, while Hong Kong's Hang Seng Index surged by 1.2%.
European markets also advanced, with France's CAC 40 Index climbing 2.1%, the UK's FTSE 100 Index up by 1.1%, and Germany's DAX Index increasing by 0.4%.
### Bond Market
In the bond market, treasuries continued their upward momentum from Wednesday's rally. Consequently, the yield on the benchmark ten-year note, which inversely relates to its price, dropped 4.7 basis points to 4.606%.
### Outlook
The U.S. economic calendar for Friday is relatively sparse, but reports on industrial production and housing starts could still garner attention.
The material has been provided by InstaForex Company -
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