Nasdaq Advances On Strength Among Tech Stocks

(RTTNews) - Strength among tech stocks contributed to a notable advance by the Nasdaq, although the Dow and the S&P 500 spent most of Thursday's session lingering near the unchanged line.

The major averages eventually ended the day mixed, as the Dow closed modestly lower. While the Dow edged down 28.42 points or 0.1 percent to 26,805.51, the Nasdaq climbed 66.00 points or 0.8 percent to 8,185.80 and the S&P 500 rose 5.77 points or 0.2 percent to 3,010.29.

The tech-heavy Nasdaq benefited from a positive reaction to earnings news Microsoft (MSFT), with the software giant climbing by 2 percent.

After the close of trading on Wednesday, Microsoft reported quarterly results that exceeded analyst estimates, boosted by cloud and Office revenues.

Electric car maker Tesla (TSLA) is also posted a standout gain on the day after reporting an unexpected third quarter profit.

Meanwhile, shares of Twitter (TWTR) came under pressure after the social media giant reported weaker than expected third quarter results and provided disappointing guidance.

A steep drop by shares of 3M (MMM) weighed on the day after the diversified manufacturer reported third quarter earnings that beat estimates but lowered its full-year earnings outlook.

Traders were also digesting a slew of U.S. economic data, including a report from the Commerce Department showing a steep drop in orders for transportation equipment contributed to a bigger than expected decrease in durable goods orders in September.

The Commerce Department said durable goods orders tumbled by 1.1 percent in September after rising by a revised 0.3 percent in August.

Economists had expected durable goods orders to decline by 0.8 percent compared to the 0.2 percent uptick that had been reported for the previous month.

Excluding the nosedive in orders for transportation equipment, durable goods orders dipped by 0.3 percent in September after climbing by 0.3 percent in August. Ex-transportation orders had expected to edge down by 0.2 percent.

A separate report from the Commerce Department showed new home sales pulled back in September after a sharp increase in the previous month.

The report said new home sales slid by 0.7 percent to an annual rate of 701,000 in September after spiking by 6.2 percent to a revised rate of 706,000 in August.

Economists had expected slump by 1.7 percent to a rate of 701,000 from the 713,000 originally reported for the previous month.

Meanwhile, the Labor Department released a report showing a modest decrease in first-time claims for U.S. unemployment benefits in the week ended October 19th.

The report said initial jobless claims dipped to 212,000, a decrease of 6,000 from the previous week's revised level of 218,000.

Economists had expected jobless claims to inch up to 215,000 from the 214,000 originally reported for the previous week.

Sector News

Gold stocks moved sharply higher over the course of trading session, driving the NYSE Arca Gold Bugs Index up by 3.4 percent.

The spike by gold stocks came amid an increase by the price of the precious metal, as gold for December delivery climbed $9 to $1,504.70 an ounce.

Significant strength was also visible among semiconductor stocks, which rebounded after falling sharply in the previous session. The Philadelphia Semiconductor Index surged up by 2.5 percent after tumbling by 1.9 percent on Wednesday.

The upbeat earnings news from Microsoft also contributed to a rally by software stocks, with the Dow Jones U.S. Software Index jumping by 2.2 percent.

On the other hand, oil service stocks saw substantial weakness on the day, dragging the Philadelphia Oil Service Index down by 1.6 percent. The sell-off came despite an increase by the price of crude oil.

Networking stocks also showed a notable move to the downside, with the NYSE Arca Networking Index falling by 1.5 percent.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Thursday. Japan's Nikkei 225 Index climbed by 0.6 percent, while Hong Kong's Hang Seng Index advanced by 0.9 percent.

The major European markets also moved to the upside on the day. While the U.K.'s FTSE 100 Index jumped by 0.9 percent, the German DAX Index and the French CAC 40 Index both rose by 0.6 percent.

In the bond market, treasuries turned in a lackluster performance before ending the session roughly flat. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, inched up by less than a basis point to 1.766 percent.

Looking Ahead

Earnings news is likely to remain in focus on Friday, with Amazon (AMZN), Intel (INTC), and Visa (V) among the companies releasing their quarterly results after the close of today's trading.

Anheuser-Busch InBev (BUD), Goodyear Tire (GT), and Verizon (VZ) are also among the companies due to report their results before the start of trading on Friday.

A revised reading on U.S. consumer sentiment in October may also attract some attention, although the University of Michigan's consumer sentiment index is expected to be unrevised at 96.

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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