By Anora Mahmudova and Barbara Kollmeyer, MarketWatch
Weekly jobless claims drop below 300,000
Weekly jobless claims drop below 300,000
NEW YORK (MarketWatch) -- U.S. stocks erased opening gains and
moved lower on Thursday, as deteriorating situation between Russia
and Ukraine sapped risk appetite globally.
Investors pushed Treasurys and gold prices higher as safe assets
were in demand.
Equities rose after fresh signs that the labor market is
improving faster than expected but gains dissipated by late
morning.
The S&P 500 (SPX) fell 3 points, or 0.2%, to 1,916.89. The
Dow Jones Industrial Average (DJI) dropped 30 points, or 0.2%, to
16,417.17
The Nasdaq Composite (RIXF) was moving between small gains and
losses and was 3 points, or 0.1%, higher at 4,358.30.
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action.
Paul Zemsky, chief investment officer of Multi-Asset Strategies
at Voya Investment Management, said data on jobs continue to be
better than expected, signaling that the labor market is improving
and remains in a sweet spot since wage growth is still
moderate.
"This market got complacent and ahead of itself a few weeks ago,
was overbought on technical levels. So, the selloff last week was
not surprising.There is nothing in our indicators that signals a
larger 10%-15% correction. However, we think the S&P 500 will
fall to 1,900 before continuing to march higher," Zemsky said.
Zemsky added that a full-blown invasion of Ukraine by Russia
could become a catalyst for a deep correction, however he said it
is hard to predict such political moves.
In economic news, the number of people who applied for
unemployment benefits fell below 300,000 for the second time in
three weeks, solidifying a picture of an improving U.S. labor
market in which layoffs remain low and companies are hiring at the
fastest pace in years.
At 3 p.m. Eastern Time, the Federal Reserve will report on
consumer credit for June.
Corporate front
21st Century Fox (NWSA) rallied 5.5% following
better-than-expected earnings results, making it the biggest riser
on the S&P 500.
Harman International Industries Inc. (HAR) fell 5.2% after the
maker of high-end stereo and audio equipment on Thursday reported
earnings that were in line with estimates. Harman also said it is
continuing its restructuring effort.
Priceline Group Inc.(PCLN) said it plans to take a $500 million
stake in Ctrip.com International Ltd. (CTRP), China's largest
online travel company. The two companies already have a commercial
agreement. Ctrip rallied 12%.
Google Inc. (GOOG) and Barnes & Noble Inc. (BKS) are teaming
up to take on rival Amazon Inc. (AMZN) in the speedy delivery of
books, the New York Times reported Thursday. Barnes & Noble
stocks rose 2%.
Shares of iDreamSky Technology Ltd. (DSKY) jumped 13% on its
first day of trading on the Nasdaq. The company describes itself as
the biggest independent mobile-game publishing platform in China.
Read more about what to know about the iDreamSky IPO.
Also read: A big week for IPOs could have sparked last week's
S&P selloff.
European questions
Investors also reacted to Mario Draghi's press conference, after
the European Central Bank left key rates unchanged, as expected.
Draghi said the euro zone's economic recovery remains "weak,
fragile, uneven" and says there has been a "slowing down" of growth
momentum.
Meanwhile, Russia revealed the specifics of its food-import ban,
introduced in retaliation against sanctions from the U.S., members
of the European Union and other nations.
European stocks struggled to show a clear direction, with the
main Stoxx 600 index off 0.1%. In Asia, the Shanghai Composite
Index tumbled 1.3% and Hong Kong's Hang Seng Index fell to its
lowest settlement in nearly two weeks as casino shares dropped.
In other markets, gold prices (GCU4) inched up after a big jump
on Wednesday, while oil (CLU4) eased off and the dollar (DXY)
inched higher.
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