RTTNews - Stocks are seeing significant strength in early afternoon trading on Thursday after turning higher earlier in the session following a move to the downside at the open. The major averages are all in positive territory by comfortable margins, prompted by some bargain hunting on the heels of a string of lackluster performances.

Earlier, a report from the Labor Department showing that jobless claims unexpectedly increases last week deflated the mood on Wall Street, contributing to the initial weakness. Nonetheless, a mild upward revision to first quarter gross domestic product figures helped to limit the early selling pressure.

In other news, Federal Reserve Chairman Ben Bernanke is testifying before the House Oversight Committee, defending his position on the purchase of Merrill Lynch by Bank of America last year.

In an interview with RTT News, Christopher Zook, chairman and chief investment officer at Caz Investments called Congressman Issa's allegations against Fed Chairman Ben Bernanke a lot of noise that candidly the market could do without.it is really distracting and Bernanke is someone that we don't want to see his credibility questioned tremendously.

Zook also discussed the tug of war trading on the Street, stressing that right now the market needs some time. Further, he said, After a 40-percent move from the bottom, it would be very healthy for us to go sideways for several months, though he added, I think that a correction is more likely.

The major averages have moved roughly sideways in recent trading, hovering near their best levels of the day. The Dow is currently up 151.90 at 8,451.76, the Nasdaq is up 30.58 at 1,822.92 and the S&P 500 is up 16.77 at 917.71.

Sector News

Notable strength has emerged among airline stocks, with the NYSE Arca Airline Index advancing by 5.7 percent. The day's upward move has helped the sector move further off of its worst closing level in well over two months, reached earlier this week.

Specifically, shares of UAL (UAUA) are helping to bolster the sector, rising by 11.4 percent on the day. With the climb, the stock is moving off of the eleven-month closing low set in the previous session.

Additional upside continues to be visible among healthcare-related stocks, with the Morgan Stanley Healthcare Payor Index and the Morgan Stanley Healthcare Provider index rising by 4.8 percent and 4.1 percent, respectively. The day's move is helping the indices to offset recent losses.

Housing and retail stocks are also enjoying strong outings, as reflected by a 3.3 percent rise by the Philadelphia Housing Sector Index and a 3.5 percent jump by the S&P Retail Index.

Further, oil service and transportation stocks are also on the rise, with the Philadelphia Oil Service Sector Index and the Dow Jones Transportation Average moving up by 3.1 percent and 3.6 percent, respectively. The sector indices are extending their gains for the third straight session, regaining some ground after Monday's retreat.

Stocks In The News

Boston Scientific Corp. (BSX) is seeing notable upside in early afternoon trading after the firm announced that Ray Elliott will take over for retiring President and CEO Jim Tobin July 13. The stock is up by 8.2 percent on the day, rising to its best intra-day price in well over eight months.

Hertz Global Holdings (HTZ) is also climbing after the firm said that it expects second quarter earnings per share in the range of $0.09 - $0.10, exceeding Wall Street estimates of $0.01 per share. The stock is up by 11.1 percent on the session, rising to the upper end of a recent trading range.

On the other hand, shares of Paychex (PAYX) are falling after the company reported fourth quarter net income of $0.32 per share, falling short of analyst expectations of $0.34 per share. The firm also said it expects net income to fall between 10 and 12 percent in 2010. Shares of the payroll processor are down by 6.3 percent, reaching their worst intra-day price in nearly three months earlier in the session.

In Focus: Economic Data, Earnings News

As mentioned above, a report from the Labor Department showed that initial jobless claims for the week ended June 20th came in at 627,000, up from last week's revised figure of 612,000.

The increase in jobless claims surprised economists, who had expected the number to edge down to 600,000 from the 608,000 originally reported for the previous week.

Separately, the Commerce Department revealed its final revision to the first quarter gross domestic product. The report indicated that first quarter GDP contracted by a revised 5.5 percent compared to the 5.7 percent decrease that had been reported.

On the earnings front, Bed Bath & Beyond (BBBY) said its first-quarter net income rose to $0.34 per share from $0.30 per share in the same quarter last year, while analysts expected the firm to earn $0.25 per share for the quarter.

While Nike (NKE) reported adjusted fourth quarter net income of $0.99 per share, which beat Wall Street expectations of $0.96 per share, the firm said worldwide future orders scheduled for delivery from June 2009 through November 2009 are down 12 percent from a year ago.

Additionally, Lennar (LEN) reported a second-quarter net loss of $0.76 per share, unchanged from the same period last year. Wall Street analysts had expected the homebuilder to report a loss of $0.64 per share for the quarter.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region ended Thursday's session showing strong gains. Japan's benchmark Nikkei 225 Index closed up 2.2 percent, while Hong Kong's Hang Seng Index jumped 2.1 percent.

Meanwhile, the major European markets closed firmly on the downside, with the German DAX Index and the U.K.'s FTSE 100 Index both sliding by 1.4 percent, while the French CAC 40 Index fell by 0.7 percent.

In the bond markets, treasuries are seeing moderate strength. Subsequently, the benchmark ten-year note is trading at 3.639 percent, a drop of 4.6 basis points on the day.

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