U.S. Stocks Turning In Lackluster Performance Following Recent Weakness

With traders taking a breather following the steep drop seen over the two previous sessions, stocks are turning in a lackluster performance in morning trading on Thursday. While the Dow has moved to the downside, the Nasdaq and the S&P 500 have spent the morning bouncing back and forth across the unchanged line.

In recent trading, the Dow has fallen to a new low for the session. The Dow is down 228.40 points or 0.7 percent at 34,268.11, while the Nasdaq is down 4.67 points or less than a tenth of a percent at 13,884.15 and the S&P 500 is down 6.75 points or 0.2 percent at 4,474.40.

The choppy trading on Wall Street comes as traders seem reluctant to make more significant moves amid uncertainty about the near-term outlook for the markets following recent volatility.

Stocks started off the week on a strong note on Monday, but pulled back sharply on Tuesday and Wednesday amid concerns about the outlook for monetary policy.

With the Federal Reserve’s next monetary policy meeting almost a month away, traders are likely to keep a close eye on the latest economic data for clues about how aggressive the central bank will be.

The Labor Department released a report this morning showing a modest decrease by first-time claims for unemployment benefits in the week ended April 2nd.

The report showed initial jobless claims dipped to 166,000, a decrease of 5,000 from the previous week’s revised level of 171,000.

Economists had expected jobless claims to edge down to 200,000 from the 202,000 originally reported for the previous week.

The economic calendar is relatively quiet for the rest of this week but will pick up next week with the release of reports on consumer and producer price inflation, retail sales and industrial production.

Airline stocks are extending the sell-off seen in the previous session, with the NYSE Arca Airline Index plunging by 2.6 percent.

Considerable weakness has also emerged among financial stocks, dragging the KBW Bank Index and the NYSE Arca Broker/Dealer Index down by 2 percent and 1.6 percent, respectively.

Interest rate-sensitive commercial real estate, housing and utilities stocks have also shown notable moves to the downside in morning trading.

On the other hand, significant strength is visible among computer hardware stocks, as reflected by the 1.7 percent gain being posted by the NYSE Arca Computer Hardware Index.

HP Inc. (HPQ) is leading the sector higher, spiking by 16.8 percent after Warren Buffett’s Berkshire Hathaway (BRK.B) revealed an 11.4 percent stake in the personal computer and printer maker.

In overseas trading, stock markets across the Asia-Pacific region moved notably lower during trading on Thursday. Japan’s Nikkei 225 Index tumbled by 1.7 percent, while China’s Shanghai Composite Index dove by 1.4 percent.

Meanwhile, the major European markets have turned mixed on the day. While the German DAX Index s up by 0.1 percent, the French CAC 40 Index is down by 0.1 percent and the U.K.’s FTSE 100 Index is down by 0.5 percent.

In the bond market, treasuries are extending the notable downward move seen in recent sessions. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 3.8 basis points at 2.647 percent.

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