Wall Street: U.S. equity markets closed higher on Thursday after jobless claims dropped last week. Financial stocks led the way higher with Bank of America and Citigroup both gaining more than 5%. However, it was not all good news for the markets: May sales reports from the nation’s biggest retailers showed that 76% missed estimates. Wal-mart, Costco and Target all declined on the day. In the Tech sector, Wind River Systems gained 47% after Intel agreed to buy the company for $884 million. Google rose 2% after Citigroup raised its target for the stock from $450 to $580. The DOW gained 74.96 points to close on 8750.24. The S&P Gained 10.70 points to close on 942.46 while the NASDAQ gained 24.10 points to close on 1850.02
Europe: European shares closed Thursday’s trade flat as drug companies and oil producing shares moved higher but mining stocks moved lower. European equity markets were also influenced by the interest rate decisions from the European Central Bank and the Bank of England, both of which kept rates on hold. As crude oil prices rose, trying to offset Wednesday’s losses, oil producers gained. BP and Total led the producers higher. Mining stocks, led by Rio Tinto and BHP Billiton, moved lower. The German DAX gained 10 points. The CAC 40 gained 2 points while the U.K.’s FTSE moved 4 points higher.
Asia: Asian equity markets closed lower on Thursday after disappointing U.S. economic news led traders to take some profits off the table, wait for the markets to settle and possibly re-buy at lower prices. Energy stocks led the decline after oil prices dropped on Wednesday. Weak U.S. data led to a drop in shipping stocks in Japan, led by Nippon Yusen as traders cut back on optimism for a global recovery. The Japanese Nikkei dropped 73 points while the Hang Seng lost 74 points.
Financial Sector: In trade on Thursday the XLF, the financial sector ETF, gained 0.37 points (3.1%) to trade at 12.37. It moved higher on slightly lower volume; 126.1m ETF's changed hands, below the ten day average of 181.0m. Equity markets closed higher on Thursday in a session that saw the major indexes move lower at the open but recover as the day progressed.
Treasuries: Treasuries dropped on Thursday, the first time in three days sparked by this morning initial jobless claims which showed the number of people collecting unemployment dropped. Yields on the ten year Treasury notes rose 12 basis points to 3.66%, approaching a six month high. Traders are now speculating that tomorrow’s nonfarm payrolls report may be better than anticipated, which would likely have the same effect on Treasuries.
Crude oil: Oil prices gained on Thursday, erasing Wednesday’s losses, rising above $68 a barrel. The move was initiated by U.S. data showing a drop in jobless claims which could lead to an economic recovery and higher demand. Oil prices gained approximately $2.65 to close near $68.80 per barrel.
Gold Bullion: Gold prices rose on Thursday as the dollar showed signs of weakness against some of the other major currencies. Gold bullion rose approximately $15 to trade near $980 an ounce. As the government continues to increase spending in order to stimulate the economy, the dollar will likely weaken and lead traders to continue to buy gold. Economists continue to warn about inflation starting to creep back into the picture and traders, historically purchase gold as a hedge against inflation.