Traders May Cash in on Recent Strength on Wall Street
By Investors Hub
The major U.S. index futures are pointing to a lower opening on Thursday following the modest strength seen in the previous session.
Profit taking may contribute to initial weakness on Wall Street after the uptick seen on Wednesday lifted the major averages to new record closing highs.
Uncertainty about the outlook for the Republican tax reform plan may also weigh on the markets along with rising tensions in the Middle East.
After several quiet days on the U.S. economic front, the Labor Department also released a report showing a bigger than expected increase in initial jobless claims in the week ended November 4th.
Stocks turned in another lackluster performance during trading on Wednesday, with the major averages spending much of the day showing only modest moves. Despite the choppy trading, the major averages reached new record closing highs.
The major averages ended the day modestly above the unchanged line. The Dow inched up 6.13 points or less than a tenth of a percent to 23,563.36, the Nasdaq rose 21.34 points or 0.3 percent to 6,789.12 and the S&P 500 edged up 3.74 points or 0.1 percent to 2,594.38.
The choppy trading on Wall Street came as many traders remained on the sidelines amid another quiet day on the U.S. economic front.
The economic calendar picks up somewhat in the coming days with the release of reports on weekly jobless claims, wholesale inventories, and consumer sentiment.
Developments overseas also attracted some attention as President Donald Trump has traveled to China to meet with Chinese President Xi Jinping.
Trump is expected to push China to do more to address the threat posed by North Korea, with the president arguing in a speech in South Korea that the weight of the crisis is on the conscience of nations that choose to ignore the threat.
“I hope I speak not only for our countries, but for all civilized nations, when I say to the North: Do not underestimate us and do not try us,” Trump said in a speech to the South Korean National Assembly.
Most of the major sectors ended the day showing only modest moves, contributing to the lackluster close by the broader markets.
Telecom stocks showed a significant move to the upside, however, with the NYSE Arca Telecom Index advancing by 1.6 percent. With the gain, the index reached a five-month closing high.
Sprint (S) helped to lead the telecom sector higher, surging up by 4.2 percent after ending the previous session at its lowest closing level in over a year.
Considerable strength was also visible among electronic storage stocks, as reflected by the 1.4 percent gain posted by the NYSE Arca Disk Drive Index. The index climbed to a two-year closing high.
Housing, networking, and pharmaceutical stocks also saw some strength on the day, while banking and natural gas stocks showed notable moves to the downside.