By Victor Reklaitis and Anora M. Gaudiano, MarketWatch
Jobless claims drop fourth week in a row to 218,000
U.S. stocks were trading lower on Thursday, with the Dow Jones
Industrial Average on track to extend its losing streak to an
eighth straight day, as uncertainty over trade policy weighed on
investor sentiment.
What are the main benchmarks doing?
The Dow Jones Industrial Average was off 129 points, or 0.5%, to
24,529. If it closes lower, it will be the eight straight session
of losses, matching the losing streak in March 2017.
The drop took the blue-chip average below its 50-day moving
average
(http://www.marketwatch.com/story/dow-breaks-below-key-level-on-track-for-8th-straight-drop-2018-06-21),
a closely watched gauge of an asset's short-term momentum.
The S&P 500 index slid 11 points, or 0.4%, at 2,755, with
energy and industrials leading losses, down more than 1%.
The Nasdaq Composite Index gave up small opening gains to trade
down 39 points, or 0.5% to 7,742, after notching a record
Wednesday.
The Dow is down by 0.8% this year, while the S&P and Nasdaq
have tacked on about 3% and 12%, respectively.
What's driving markets?
Markets remain fixated on trade tensions between the U.S. and
key trading partners such as China and the European Union.
Investors are worried the tensions and recent tariffs could
develop into a headwind for the global economy. These concerns come
as the U.S. economy, the world's largest, is increasingly viewed as
in the late stages of its expansion
(http://www.marketwatch.com/story/slowing-growth-stalling-stocks-raise-fear-that-economys-good-days-are-numbered-2018-05-07).
What are strategists saying?
"Industrials are taking a hit because these are the companies
that will see the impact of higher aluminum prices and higher
energy. This group reflects investor sentiment about trade issues
better than other sector," said Mitchell O. Goldberg, president at
ClientFirst Strategy Inc., a N.Y.-based advisory firm.
"A trade war is getting too close to reality for the comfort of
many investors," said Lindsey Bell, an investment strategist at
CFRA, in a note.
Volatility is likely to continue at least until more
second-quarter earnings are released in mid-July, but early
reporter FedEx Corp
(http://www.marketwatch.com/story/fedex-shares-edge-up-after-earnings-beat-2018-06-19).(FDX)
did stick by its forecasts for U.S. and global economic growth this
week, even as it voiced concerns about trade tensions, she
added.
"Like a well-seasoned CEO, we believe investors will be better
served with a long-term focus while trade policies and volatility
are ironed out," Bell wrote.
Check out:Trader tries out 'demo' platform, ends up with actual
$5 billion position
(http://www.marketwatch.com/story/day-trader-tries-out-demo-platform-ends-up-with-actual-5-billion-position-2018-06-21)
Which economic reports are on tap?
The labor market continues to tighten. Initial jobless claims
declined
(http://www.marketwatch.com/story/jobless-claims-drop-fourth-week-in-a-row-to-218000-2018-06-21)by
3,000 to 218,000 in the seven days ended June 16, near levels last
seen in the early 1970s.
Meanwhile, the Philadelphia Fed's manufacturing index
(http://www.marketwatch.com/story/philly-fed-manufacturing-index-slows-in-june-2018-06-21)slowed
sharply to a reading of 19.9 in June from 34.4 in May. Any reading
above zero indicates improved conditions.
The leading economic index
(http://www.marketwatch.com/story/robust-us-economy-not-speeding-up-but-its-not-slowing-down-either-leading-indicators-show-2018-06-21)rose
0.2% in May, which was a slower pace than in prior months.
Check out:MarketWatch's Economic Calendar
(http://www.marketwatch.com/economy-politics/calendars/economic)
Which stocks are in focus?
Shares in Micron Technology Inc.(MU)traded 3% higher after the
chip company late Wednesday reported strong profit and sales gains
as well as a confident forecast
(http://www.marketwatch.com/story/micron-earnings-prove-the-doubters-wrong-again-2018-06-20).
Shares in Olive Garden parent
(http://www.marketwatch.com/story/olive-garden-parent-darden-restaurants-shares-jump-83-after-earnings-beat-2018-06-21)Darden
Restaurants Inc.(DRI)and Kroger Co.(KR)jumped 9.5% and 11%
(http://www.marketwatch.com/story/kroger-shares-soar-87-after-earnings-beat-expectations-and-tweaks-guidance-2018-06-21),
respectively, after each company posted an earnings beat before the
opening bell.
But American Outdoor Brands Corp.'s stock (AOBC)fell 7.6% after
the Smith & Wesson parent company's quarterly report late
Wednesday. Executives said they plan to lower advertising spending
and firearms production
(http://www.marketwatch.com/story/sales-slump-continues-for-smith-wesson-parent-2018-06-20)
to address what's expected to be at least another year of falling
gun sales.
Shares of online retailers fell sharply after the Supreme Court
handed states broad authority to require online retailers to
collect sales taxes. Shares of Amazon.com(AMZN), which already
collects state sales tax on products they sell directly
(http://www.marketwatch.com/story/amazon-shares-fall-after-supreme-court-ruling-on-sales-tax-as-brick-and-mortar-retailers-gain-2018-06-21),
fell 0.6%.
Wayfair Inc(W) and eBay Inc(EBAY) fell about 2% while Etsy
Inc(ETSY) dropped more than 3%.
What are other markets doing?
European stocks
(http://www.marketwatch.com/story/auto-makers-italian-stocks-lead-european-shares-lower-2018-06-21)declined
as traders assessed the Bank of England's 6-3 vote
(http://www.marketwatch.com/story/ftse-100-gains-ground-as-pound-dips-before-bank-of-england-rate-verdict-2018-06-21)
in favor of standing pat on interest rates. Australia and Japan's
equity markets closed with gains,
(http://www.marketwatch.com/story/surge-from-down-under-leads-asia-pacific-stock-gains-2018-06-20)
but other Asia-Pacific gauges fell.
Oil futures dropped, as OPEC members seemed to be closing in on
an output deal
(http://www.marketwatch.com/story/oil-prices-slump-as-opec-appears-closer-to-deal-on-higher-output-2018-06-21)
at Friday's meeting
(http://www.marketwatch.com/story/opec-risks-destroying-its-oil-market-success-2018-06-14)
in Vienna. Gold futures fell 0.4% to $1,270. The ICE U.S. Dollar
Index moved lower, down 0.2%, to 94.847.
Don't miss:Here's what could happen to oil if everyone's wrong
on OPEC
(http://www.marketwatch.com/story/heres-what-happens-to-oil-if-everyones-opec-expectations-are-wrong-2018-06-21)
(END) Dow Jones Newswires
June 21, 2018 11:47 ET (15:47 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.