Unexpected increase in weekly jobless claims impact the momentuim
US stocks ended in a mixed note on Thursday, 11 September 2014 at Wall Street. Marginal gains on Wall Street were led by small-cap stocks on Thursday. Trading was choppy, as an unexpected increase in weekly jobless claims and falling commodities prices encouraged investors to remain cautious. The main benchmarks finished in positive territory after trading in a tight range and spending much of the session in the red.
The Dow Jones Industrial Average closed down 19.71 points, or 0.1%, to 17,049.00. The Nasdaq Composite tacked on 5.3 points, or 0.1%, to 4,591.81. The S&P 500 ended 1.8 points, or 0.1%, higher at 1,997.45.
Eight out of ten sectors ended higher as utilities and telecoms led the gains. Three influential sectors energy, technology and health care sectors drove the market to lows during the first 90 minutes of action.
U.S. economic data released Thursday included the weekly jobless claims report, which came in weaker than expected (a rise in claims). That report had little lasting impact on the markets, however.
Initial claims increased to 315,000 from an upwardly revised 304,000 (from 302,000), while the consensus expected a decline to 300,000. Throughout July and August, the initial claims level had averaged roughly 300,000 per week, a level normally associated with an economy that is running at, or near, full employment, but this week's increase in claims brought the level back to its average from March through June
The Treasury Budget for August showed a deficit of $128.70 billion, which followed the prior deficit of $147.90 billion, while the consensus expected a deficit of $129.00 billion.
In overnight news, China's consumer price index was reported up 2.0%, year-on-year, in August, versus up 2.3% in July. A rise of 2.2% was expected for August. That's some good news for the beleaguered raw commodity sector, as it suggests China, the world's largest raw commodity importer, won't have to tighten its monetary policy to keep inflation in check.
In another sign of the present ill health of the raw commodity sector, the United Nations reported Thursday that world food prices fell to a four-year low in August. Crude oil and grains are leading a price slump in the raw commodity sector.
Bullion prices ended lower at Comex on Thursday, 11 September 2014. Gold futures fell for a fourth straight session undercut by a dollar that remained supported by expectations the Federal Reserve will take a more hawkish tone on interest rates.
Gold futures for December delivery lost $6.30, or 0.5%, to settle at $1,239 an ounce. September silver futures dropped 32 cents, or 1.7%, to $18.53 an ounce.
Crude Oil futures staged a comeback on Thursday, 11 September 2014 at Nymex with refiners and other commercial buyers stepping in as prices hit multi-year lows during the session. Prices headed south earlier Thursday after the International Energy Agency cut its forecast for global oil demand for the third month in a row.
Crude for delivery in October rose $1.16, or 1.1%, to settle at $92.83 a barrel at Nymex. It had traded as low as $90.43 a barrel, its lowest point since April 2013, before erasing losses.
The IEA said it expects global oil demand to grow by 0.9 million barrels a day this year. That's down 65,000 barrels a day compared with the Paris-based group's outlook released last month, and down by 300,000 barrels a day since July. The cut in the IEA's demand expectations followed a similar move by OPEC on Wednesday, which contributed to oil ending at an eight-month low in the previous session.
Participation was below average with 591 million shares changing hands at the NYSE floor.
Tomorrow, the Retail Sales report for August (consensus 0.6%) and August Import/Export Prices will be released at 8:30 ET, while the preliminary reading of the Michigan Sentiment Survey (consensus 83.5) will cross the wires at 9:55 ET. The day's data will be topped off with the 10:00 ET release of the Business Inventories report for July (expected 0.4%).
Traders and investors are already looking ahead to next week, and a more robust batch of economic data points, highlighted by the meeting of the U.S. Federal Reserve's Open Market Committee (FOMC). Next week is also the much-anticipated referendum on Scotland's independence from the U.K.
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