RTTNews - Stocks are seeing some strength in mid-morning trading on Thursday, as traders react positively to the latest batch of economic data. The major averages have all moved firmly into positive territory, although they have moved off of their best levels of the day in recent trading.
The strength in the markets comes as traders digest a report released by the Commerce Department showing a notable increase in retail sales in the month of May, although the sales growth was largely due to a jump in gasoline prices that drove up sales at gas stations.
The report showed that retail sales rose 0.5 percent in May following a revised 0.2 percent decrease in April. Economists had expected sales to increase by 0.5 percent compared to the 0.4 percent decrease originally reported for the previous month.
A considerable increase in sales by gas stations contributed to the retail sales growth, with gas station sales jumping 3.6 percent in May after slipping 0.8 percent in April. Excluding the increase in sales by gas station, retail sales showed a much more modest increase of 0.2 percent.
Separately, the U.S. Labor Department revealed that initial jobless claims, a closely watched gauge of layoffs, came in at 601,000 for the week ended at June 6th. This was down 24,000 from the previous week's revised level of 625,000.
However, continuing claims, which measure the number of people receiving ongoing unemployment help, rose to 6.816 million in the week ended May 30th. Due to an upward revision to the previous week's figure, continuing claims rose to a new record high for the 19th consecutive week.
In other news, the House Oversight and Government Reform Committee is hosting former Bank of America (BAC) CEO Ken Lewis as part of a growing investigation into whether government officials pressured the bank to withhold details about the purchase of Merrill Lynch from investors despite ballooning losses at the brokerage firm.
As mentioned above, the major averages have moved off their highs for the session in recent trading, but they are holding onto strong gains. The Dow is currently up 71.50 at 8,810.52, the Nasdaq is up 16.03 at 1,869.11 and the S&P 500 is up 8.58 at 947.73.
Most of the major sectors are moving higher, helping the major averages to post notable gains on the day.
Some of the day's best performances are being turned in by biotechnology stocks, as reflected by the 2.2 percent gain shown by the Amex Biotechnology Index. At it highs for the session, the index challenged its best intraday level in over three months set last week.
Human Genome Sciences (HGSI) is helping to lead the sector higher, advancing by 17.3 percent in mid-morning trading. With the gain, the stock has reached its best intraday level in nearly eight months.
The gain by Human Genome Sciences comes after the firm revealed positive long-term test results for its drug BENLYSTA in patients with active systemic Lupus Erythematosus.
Comparable gains are being shown by banking, computer hardware, tobacco and airline stocks, representing the day's broad based strength.
Meanwhile, housing and health insurance stocks are bucking the uptrend, with the Philadelphia Housing Sector Index and the Morgan Stanley Healthcare Payor Index down by 1.4 percent and 1.2 percent, respectively.
Stocks Driven By Analyst Comments
Shares of GlaxoSmithKline (GSK) are rising following an upgrade from Morgan Stanley, which raised its rating on the stock to equal weight from underweight. The stock has moved up by 4.3 percent on the day, rising to its best intraday level in well over three months earlier in the session.
Xenoport (XNPT) is also moving higher after being upgraded by Ladenburg Thalmann to Buy from Neutral, with its target price boosted to $25 from $19. Shares of the biopharmaceutical company are up by 7.3 percent, challenging their best intraday level in over three months.
On the other hand, Concur Technologies (CNQR) is sliding after AmTech Research downgraded the stock to Neutral from Buy. The firm's stock is down by 6.9 percent on the day, pulling back off the eight-month high set in the previous session.
In overseas trading, stock markets across the Asia-Pacific region ended Thursday's session largely unchanged. Japan's benchmark Nikkei 225 Index fell by 0.1 percent, while Hong Kong's Hang Seng closed up by less than a tenth of a percent.
Meanwhile, the major European markets have moved to the upside after some earlier uncertainty. The German DAX Index and the French CAC 40 Index are up by 1.0 and 0.7 percent, respectively. The U.K.'s FTSE 100 is also on the rise, climbing by 0.7 percent.
In the bond markets, treasuries are showing modest weakness but are well off of their worst levels of the day. Subsequently, the yield on the benchmark ten-year note is trading at 3.954 percent, an increase of 1.8 basis points on the day.
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