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Interest in riskier investments was largely generated by data on first-time claims for unemployment benefits, which showed a substantial decrease in the week ended July 4th, according to a report released by the Labor Department.
This afternoon, traders looked to the results of the Treasury Department's $11.0 billion auction of 30-year bonds. The sale saw mixed results with the yield coming in largely near expectations at 4.303 percent, while the bid-to-cover ratio came in at 2.36, lower than the previous auction.
The bid-to-cover ratio is a measure of demand that indicates the amount of bids for each dollar worth of securities being sold.
After the markets close today, Dow component Chevron (CVX | Quote | Chart | News | PowerRating) is set to report its second quarter earnings. Wall Street analysts expect the oil giant to report earnings of $1.22 per share compared to $2.90 per share in the same quarter last year.
In recent trading, the Nasdaq and the S&P 500 have risen to new highs for the session, while the Dow has climbed back near its best levels. The Dow is currently up 36.80 at 8,215.21, the Nasdaq is up 15.14 at 1,762.31 and the S&P 500 is up 7.56 at 887.12.
Dow Components
Two of the Dow's strongest performers are financial giants JP Morgan Chase (JPM | Quote | Chart | News | PowerRating) and Bank of America (BAC | Quote | Chart | News | PowerRating), which are rising by 3 percent and 1.9 percent, respectively.
JP Morgan Chase is continuing its move off the four-month lows set in early July. Meanwhile, Bank of America is bouncing off of a one-month closing low set on Wednesday.
Shares of diversified conglomerate General Electric (GE | Quote | Chart | News | PowerRating) are also on the rise, moving up by 2.4 percent on the day. The climb has helped the stock move up from the three-month closing low set in the previous session.
DuPont (DD | Quote | Chart | News | PowerRating), IBM Corp. (IBM | Quote | Chart | News | PowerRating) and Caterpillar (CAT | Quote | Chart | News | PowerRating) are also advancing, moving off of comparable multi-month lows set during following the broad-based plunge in equities on Tuesday.
On the other hand, shares of Merck (MRK | Quote | Chart | News | PowerRating) and Pfizer (PFE | Quote | Chart | News | PowerRating) are posting notable losses, giving back recent gains. The losses reflect some weakness in the pharmaceutical sector.
Sector News
After seeing early strength, semiconductor stocks are extending their move to the upside, with the Philadelphia Semiconductor Sector Index posting a 3.6 percent gain in mid-afternoon trading. With the move, the index is bouncing well off the nearly seven-week closing low set in the previous session.
Banking stocks are also rising, as reflected by the 3 percent gain being shown by the Kbw Bank Index. The index is moving well off of its worst closing level in nine weeks, helped by Huntington Bancshares (HBAN | Quote | Chart | News | PowerRating), which has surged up by 11.2 percent. The jump has helped the stock move well off the two-month closing low set on Wednesday.
Resource stocks also continue to recover from their recent pullback, with strong gains visible among gold, steel and natural gas stocks. The gains by gold stocks come amid a rebound by the price of the precious metal, with gold for August delivery currently up $6.90 at $916.20 an ounce.
While housing, oil service, brokerage and internet stocks are also showing notable moves to the upside, tobacco and pharmaceutical stocks continue to disappoint, drifting lower by mild margins.
In Focus: Employment Data, Alcoa Earnings, Fed Buyback
As discussed earlier, data from the Labor Department showed that jobless claims fell to 565,000 in the week ended July 4th from the previous week's revised figure of 617,000. Economists had been expecting a more modest decrease to 603,000 from the 614,000 originally reported for the previous week.
With the bigger than expected decrease, weekly jobless claims fell below the 600,000 level for the first time since January.
On the earnings front, Alcoa (AA | Quote | Chart | News | PowerRating) reported an adjusted second quarter loss of $256 million or $0.26 per share, while Wall Street expected the company to report a loss of $0.37 per share. The firm also reported quarterly revenues of $4.2 billion, edging out analyst estimates of $3.93 billion.
CEO Klaus Kleinfeld expressed hope that stimulus measures unveiled by the U.S and Chinese governments might help revive demand for the company's products.
In other news, the Federal Reserve continued its treasury buyback program Thursday, completing its second quantitative easing move of the week. The New York Federal Reserve purchased $3 billion worth of securities with maturity dates ranging from July of 2010 to April of 2011.
The day's buyback saw a total of $17.1 billion in treasuries submitted for purchase. Overall, the Fed has purchased a total of $200.72 billion since the program began on March 25th.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region ended Thursday's session on a mixed note. Japan's benchmark Nikkei 225 Index closed down by 1.4 percent, while Hong Kong's Hang Seng Index rose by 0.4 percent on the day.
Meanwhile, the major European markets all closed on the upside, with the German DAX Index closing up by 1.3 percent, while the French CAC 40 Index and the U.K.'s FTSE 100 Index both rose by 0.5 percent.
In the bond markets, treasuries continue to show notable weakness amid buying interest in the stock market. Subsequently, the yield on the benchmark ten-year note is trading at 3.411 percent, rising by 12.2 basis points on the day.
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