U.S. Stocks Seeing Modest Weakness In Morning Trading

Stocks are seeing modest weakness in morning trading on Thursday, extending the pullback seen in the previous session. Selling pressure has remained relatively subdued, however, limiting the downside for the major averages.

Currently, the major averages are off their worst levels but still in the red. The Dow is down 150.01 points or 0.4 percent at 35,078.80, the Nasdaq is down 36.83 points or 0.3 percent at 14,405.45 and the S&P 500 is down 10.69 points or 0.2 percent at 4,591.76.

The modest weakness on Wall Street comes as some traders continue to cash in on recent strength in the markets, which lifted the Nasdaq and the S&P 500 to their best closing levels in well over two months on Tuesday.

At the same time, traders seem reluctant to make significant moves ahead of the release of the Labor Department’s closely watched monthly employment report on Friday.

Economists currently expect the report to show employment jumped by 490,000 jobs in March after surging by 678,000 jobs in February. The unemployment rate is expected to edge down to 3.7 percent from 3.8 percent.

The jobs data could impact expectations regarding how quickly the Federal Reserve plans to raise interest rates in the month ahead.

A day ahead of the release of the closely watched monthly jobs report, the Labor Department released a report on Thursday showing a modest increase in first-time claims for U.S. unemployment benefits in the week ended March 26th.

The report showed initial jobless claims edged up to 202,000, an increase of 14,000 from the previous week’s revised level of 188,000.

Economists had expected jobless claims to inch up to 197,000 from the 187,000 originally reported for the previous week.

The figure originally reported for the previous week reflected the lowest number of jobless claims since September of 1969.

The Commerce Department also released a report showing personal income in the U.S. increased in line with economist estimates in the month of February.

The report showed personal income rose by 0.5 percent in February after inching up by a revised 0.1 percent in January.

Economists had expected personal income to climb by 0.5 percent compared to the unchanged reading originally reported for the previous month.

Meanwhile, the Commerce Department said personal spending edged up by 0.2 percent in February after surging by an upwardly revised 2.7 percent in January.

Personal spending was expected to increase by 0.5 percent compared to the 2.1 percent jump originally reported for the previous month.

A reading on inflation said to be preferred by the Federal Reserve showed the annual rate of core consumer price growth accelerated to 5.4 percent in February from 5.2 percent in January.

Computer hardware stocks are seeing significant weakness in morning trading, dragging the NYSE Arca Computer Hardware Index down by 1.8 percent.

Dell (DELL) and HP Inc. (HPQ) are posting notable losses after Morgan Stanley downgraded both computer equipment makers.

Housing and financial stocks have also moved to the downside on the day, while notable strength has emerged among airline, tobacco and natural gas stocks.

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Thursday. Japan’s Nikkei 225 Index slid by 0.7 percent, while China’s Shanghai Composite Index fell by 0.4 percent.

The major European markets have also moved to the downside on the day. While the U.K.’s FTSE 100 Index is down by 0.6 percent, the French CAC 40 Index and the German DAX Index are down by 1.1 percent and 1.2 percent, respectively.

In the bond market, treasuries are extending the rebound seen over the past few sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 3.6 basis points at 2.322 percent.

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