U.S. Stocks Seeing Modest Strength, Nasdaq And S&P 500 Reach New Record Highs

With traders returning to their desks following the Juneteenth holiday on Wednesday, stocks are seeing modest strength during trading on Thursday. While buying interest has remained somewhat subdued, the Nasdaq and the S&P 500 have once again reached new record intraday highs.

Currently, the major averages are off their highs of the session but still in positive territory. The Dow is up 94.11 points or 0.2 percent at 38,928.97, the Nasdaq is up 26.62 points or 0.2 percent at 17,888.85 and the S&P 500 is up 10.55 points or 0.2 percent at 5,497.58.

The modest strength on Wall Street comes amid a continued advance by shares of Nvidia (NVDA), with the AI darling and market leader surging by 2.5 percent.

Nvidia shot up by 3.5 percent during trading on Tuesday, surpassing Microsoft (MSFT) as the world’s most valuable public company.

Traders are also digesting the latest batch of U.S. economic data, including a Labor Department report showing a modest pullback by first-time claims for U.S. unemployment benefits in the week ended June 15th.

The Labor Department said initial jobless claims dipped to 238,000, a decrease of 5,000 from the previous week’s revised level of 243,000.

Economists had expected jobless claims to fall to 235,000 from the 242,000 originally reported for the previous week.

The upwardly revised number for the previous week marked the highest level since claims reached 248,000 in the week ended August 12, 2003.

“Initial claims fell less than we anticipated in the week ended June 15 and point toward a moderation in growth in nonfarm payrolls in June,” said Ryan Sweet, Chief U.S. Economist at Oxford Economics.

He added, “The risk of labor demand being too weak to prevent the unemployment rate from rising could give some support in cutting interest rates as an imbalance in the labor market is unlikely to be a significant factor in future inflation.”

Meanwhile, a separate report released by the Commerce Department unexpectedly showed a steep drop in new residential construction in the U.S. in the month of May.

The Commerce Department said housing starts plunged by 5.5 percent to an annual rate of 1.277 million in May after surging by 4.1 percent to a revised rate of 1.352 million in April.

Economists had expected housing starts to climb by 0.7 percent to an annual rate of 1.370 million from the 1.360 million originally reported for the previous month.

The report also said building permits slumped by 3.8 percent to an annual rate of 1.386 million in May after tumbling by 3.0 percent to a rate of 1.440 million in April.

Building permits, an indicator of future housing demand, were expected to increase by 0.7 percent to an annual rate of 1.450 million.

Sector News

Gold stocks are turning in some of the market’s best performances, resulting in a 2.5 percent surge by the NYSE Arca Gold Bugs Index.

The rally by gold stocks comes amid a sharp increase by the price of the precious metal with gold for August delivery jumping $30.90 to $2,377.80 an ounce.

An increase by the price of crude oil is also contributing to considerable strength among oil producer stocks, as reflected by the 1.8 percent gain being posted by the NYSE Arca Oil Index.

Transportation and steel stocks are also seeing notable strength on the day, while housing stocks have moved to the downside.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Thursday. Japan’s Nikkei 225 Index crept up by 0.2 percent, while China’s Shanghai Composite Index fell by 0.4 percent.

Meanwhile, the major European markets have all moved notably higher on the day. While the French CAC 40 Index has surged by 1.5 percent, the German DAX Index is up by 1.0 percent and the U.K.’s FTSE 100 Index is up by 0.8 percent.

In the bond market, treasuries have moved back to the downside following the rebound seen on Tuesday. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 5.2 basis points at 4.269 percent.