Following the lackluster performance seen during trading on Wednesday, stocks continued to experience choppy trading during Thursday’s session. The major averages once again spent the day bouncing back and forth across the unchanged line.

The major averages eventually finished the day modestly lower. While the Nasdaq edged down 6.65 points or less than a tenth of a percent to 17,918.48, the S&P 500 (SPI:SP500) slipped 9.60 points or 0.2 percent to 5,699.94 and the narrower Dow fell 184.93 points or 0.4 percent to 42,011.59.

The lack of direction on Wall Street came as traders seemed reluctant to make significant moves ahead of the release of the Labor Department’s highly anticipated monthly jobs report on Friday.

Economists currently expect the report to show employment rose by 140,000 jobs in September after climbing by 142,000 jobs in August, while the unemployment rate is expected to hold at 4.2 percent.

The data could impact the outlook for the U.S. economy as well as expectations regarding how aggressively the Federal Reserve will lower interest rates.

With the jobs data looming, CME Group’s FedWatch Tool is currently indicating a 65.4 percent chance the Fed will lower rates by a quarter point and a 34.6 percent chance of another half point rate cut.

A day ahead of the release of the more closely watched monthly jobs report, the Labor Department released a report this morning showing an uptick by first-time claims for U.S. unemployment benefits in the week ended September 28th.

Traders also kept an eye on the latest developments in the Middle East, where an escalating conflict has contributed to a sharp increase by the price of crude oil.

The Israel Defense Forces said around 100 projectiles were launched from Lebanon into Israel earlier today, while the IDF also said they have killed several Hezbollah commanders in a strike on a military structure in southern Lebanon.

The latest developments come following Iran’s ballistic missile attack on Israel earlier this week, with Israel vowing a “very strong” response.

Sector News

Gold stocks saw substantial weakness on the day, dragging the NYSE Arca Gold Bugs Index down by 2.0 percent. The weakness in the sector came despite a modest increase by the price of gold.

Significant weakness was also visible among airline stocks, as reflected by the 1.4 loss posted by the NYSE Arca Airline Index.

Steel, networking and biotechnology stocks also showed notable moves to the downside, while energy stocks moved sharply higher along with the price of crude oil.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in another mixed performance during trading on Thursday. Japan’s Nikkei 225 Index surged by 2.0 percent, while Hong Kong’s Hang Seng Index slumped by 1.5 percent.

Meanwhile, the major European markets all moved to the downside on the day. While the French CAC 40 Index slumped by 1.3 percent, the German DAX Index slid by 0.8 percent and the U.K.’s FTSE 100 Index edged down by 0.1 percent.

In the bond market, treasuries extended the downward move seen in the previous session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, advanced 6.5 basis points to 3.850 percent.

Looking Ahead

Trading on Friday is likely be driven by reaction to the Labor Department’s monthly jobs reports and its impact on the outlook for the economy and interest rates.

SOURCE: RTTNEWS