Markets

Midday Update: Stocks Mostly Higher as Data Beats Estimates; Fed Expected To Talk Down Higher Rates

Stocks on Thursday are building on Wednesday's highs after a round of bullish economic data coupled with market-friendly Federal Open Market Committee minutes from the July meeting fueled a record high in the S&P 500 and another 14-year high for the Nasdaq Composite Index.

Led by gains in financial and consumer staple stocks, the Dow Jones Industrial Average is back over 17,000 and outperforming the other major market indices.

Also supportive of equities on Thursday is the start of the annual central bank conference in Jackson Hole, Wyoming. Investors are positioning for what is expected to be dovish remarks from Fed Chair Janet Yellen on Friday, soothing worries that recent economic data on the employment and housing market might provoke the Fed to hike rates sooner than expected.

A heavy economic calendar kicked off with a 14,000 drop in the number of new, weekly unemployment claims to 298,000, beating estimates for a decline of 11,000 to 300,000.

This was followed by a better-than-expected improvement in the August Purchasing Managers Index to 58.0 from 55.8 in July. The Philadelphia Fed's index measuring regional business conditions jumped to a three-year high of 28.0 from 23.9 in July, beating estimates for a decline to 20.0.

In addition, existing home sales rose 2.4% -- the fourth consecutive monthly gain -- to a seasonally-adjusted annual rate (SAAR) of 5.15 million homes in July, topping estimates for a 5.00 million SAAR. June was revised downward to 5.03 mln from 5.04 mln.

Lastly, leading economic indicators rose 0.9% last month, beat estimates for a 0.6% increase.

European equities were also higher Thursday despite disappointing manufacturing data from China and the EU-zone. Overseas markets were buoyed by recent strength in the U.S. market along with speculation that the European Central Bank will adopt a more accommodative bias as a result of deflationary pressures and impact on the EU economy from disruptions in Russian oil and fall-out from sanctions. ECB President Mario Draghi will deliver a speech at tomorrow's Jackson Hole banking conference,

Crude oil was up $0.64 to $94.07 per barrel. Natural gas was down $0.01 to $3.85 per 1 million BTU. Gold was down $18.00 to $1,277.40 an ounce, while silver was down $0.13 to $19.44 an ounce. Copper was unchanged at $3.20 per pound.

Among energy ETFs, the United States Oil Fund was up 0.89% to $35.16 with the United States Natural Gas Fund was down 0.43% to $20.98. Amongst precious-metal funds, the Market Vectors Gold Miners ETF was down 2.61% to 25.99 while SPDR Gold Shares were down 1.14% to $122.81. The iShares Silver Trust was down 0.61% to $18.61.

Here's where the markets stand at mid-day:

S&P 500 is up 5 points (+0.3%) at 1,991

DJIA is up 68 points (+0.4%) at 17,047

Nasdaq Composite is up less than 1 point (+0.0%) at 4,526

UPSIDE MOVERS

(+) BONT (+10.12%) Reported disappointing Q2 earnings and guidance, but same-store sales up

(+) BSPM (+6.28%) Q2 earnings swung from a loss the year prior

(+) EVRY (+24.27%) Agrees to sell UK business

(+) CBDE (+17.00%) Awarded $1.7mln in new contracts

DOWNSIDE MOVERS

(-) AMPE (-25.47%) Osteoarthritis drug mishandled by supplier during recent trial

(-) KIN (-26.51%) Study of CereKin (KB010) did not meet primary endpoint

(-) CYBX (-6.25%) Reported weaker-than-expected results for Q1 ended July 25

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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