By Investors Hub
The major U.S. index futures are currently pointing to a lower opening on Friday following the upward move seen for five consecutive sessions.
Profit taking may contribute to initial weakness on Wall Street along with concerns about the ongoing government shutdown and skepticism about a potential trade deal between the U.S. and China.
Stocks managed to recover from an early downward move on Thursday, however, as recent upward momentum helped the major averages extend their recent winning streak.
Early trading may be impacted by reaction to a report
from the Labor Department showing a slight drop in consumer prices in
the month of December.
After recovering from an early move to the downside, stocks moved mostly higher over the course of the trading day on Thursday. With the turnaround on the day, the major averages closed higher for the fifth consecutive session.
The major averages ended the day just off their highs of the session. The Dow advanced 122.80 points or 0.5 percent to 24,001.92, the Nasdaq rose 28.99 points or 0.4 percent to 6,986.07 and the S&P 500 climbed 11.68 points or 0.5 percent to 2,596.64.
The initial weakness on Wall Street came as traders cashed in on recent strength on Wall Street as assessments of trade talks between the U.S. and China showed no significant breakthroughs.
A statement from the office of U.S. Trade Representative Robert Lighthizer said the meetings were held as part of an agreement between President Donald Trump and Chinese President Xi Jinping to engage in 90 days of negotiations with a view to achieving needed structural changes in China.
The statement said the talks included discussions on China’s pledge to purchase a substantial amount of U.S. goods and services but did not provide details about the tone or outcome of the meetings.
“The United States officials conveyed President Trump’s commitment to addressing our persistent trade deficit and to resolving structural issues in order to improve trade between our countries,” the statement said.
The statement indicated the delegation led by Deputy U.S. Trade Representative Jeffrey Gerrish will now report back to receive guidance on the next steps.
Meanwhile, a statement from China’s Commerce Ministry described the talks as “extensive, in-depth and detailed” and said the meetings “laid a foundation for the resolution of each others’ concerns.”
Selling pressure waned shortly after the start of trading, however, as traders remain optimistic the U.S. and China will eventually reach a long-term trade deal.
On the U.S. economic front, the Labor Department released a report showing a bigger than expected drop in initial jobless claims in the week ended January 5th.
The report said initial jobless claims fell to 216,000, a decrease of 17,000 from the previous week’s revised level of 233,000.
Economists had expected jobless claims to dip to 225,000 from the 231.000 originally reported for the previous week.
Traders also kept an eye on remarks by Federal Reserve Chairman Jerome Powell, who reiterated the Fed will be patient in raising interest rates further, noting the central bank is “waiting and watching.”
Powell also said during a discussion at the Economic Club of Washington that the Fed’s balance sheet will be “substantially smaller than it is now.”
Biotechnology stocks showed a significant move to the upside over the course of the session, driving the NYSE Arca Biotechnology Index up by 1.6 percent. With the jump, the index reached its best closing level in over a month.
Considerable strength also emerged among interest rate-sensitive commercial real estate and utilities stocks, with the Dow Jones Real Estate Index and the Dow Jones Utility Average both climbing by 1.4 percent.
Telecom, semiconductor, and networking stocks also saw notable strength on the day, while gold stocks moved lower along with the price of the precious metal.
more recommended stories
CBN Holds First 2019 Monetary Policy Meeting Next Week
By Dipo Olowookere The first Monetary.
FSDH, Proshare, Mouka Ltd, 357 Other Firms to Inspire Africa in 2019
By Dipo Olowookere The London Stock.
CBN Raises Rates for 91-day, One-Year T-Bills at PMA
By Dipo Olowookere In line with.
Local Stocks Gain 1.07% Amid Disappointing Inflation Data
By Dipo Olowookere The disappointing inflation.