Market Snapshot: U.S. stocks lose steam, close modestly higher
An early-morning rally on Wall Street lost steam toward the end of the session, with the main indexes closing only modestly higher on Thursday.
U.S. stocks rallied in early session echoing big gains in global equity markets, on what appeared to be a “risk-off day” when investors sold havens such as Treasuries and piled into riskier assets such as stocks and commodities.
Trading on Thursday was much more muted with volumes slightly lower than usual, a day after Wall Street trading session was marked by a 3 1/2-hour halt on the New York Stock Exchange due to a technical issue.
Read: Why the NYSE trading halt should alarm investors
The S&P 500 SPX, +0.23% closed 4.61 points, or 0.2%, higher at 2,051.31. The Dow Jones Industrial Average DJIA, +0.19% relinquished most of a 260-point gain, ending 33.20 points, or 0.2%, higher at 17,548.62. The Nasdaq Composite COMP, +0.26% ended the day with a gain of 12.64 points, or 0.3% at 4,922.40.
Chinese stock markets jumped on Thursday, as did equities in Europe, where investors were waiting for Greece to submit a fresh set of reform proposals before a midnight deadline. Greek banks and the Athens stock market GD, +2.03% remain closed until Monday.
Follow the latest news on the Greek debt crisis here
Colin Cieszynski, chief market strategist at CMC Markets, said U.S. stocks are still in a long-term sideways trend.
“Most of the market reaction is due to overseas headlines and because markets are not always rational, some headlines have greater impact than others, even though logically they should not,” Cieszynski said.
“For example, the impact of China’s stock market crash is probably bigger on the U.S. than Greece, but Wednesday’s selloff was not particularly big. And because the selloff was not big, we are not seeing a bigger bounce,” he said.
“In our view, China is in the midst of a triple bubble, with the third biggest credit bubble of all time, the largest investment bubble (proxied by the investment share of GDP) and the second biggest real estate bubble,” wrote Jeffrey D. Saut, chief investment strategist at Raymond James.
“Plainly, the Chinese ‘crash’ is having more of an impact on world markets than the Greek Gotcha despite the media’s machinations. Yet, I continue to think our markets are in a bottoming phase that is typified by the kind of whipsaw action we have seen this week,” Saut wrote in a note to investors.
Read: Citi: ‘Grexit’ could happen as soon as this quarter
Data: The number of people who applied for U.S. unemployment benefits in the week ended July 4 rose unexpectedly to the highest level since February, mainly because of annual shutdowns at auto plants in states such as Michigan and Ohio for retooling.
Market reaction to an unexpected jump in weekly jobless claims, released ahead of the opening bell, was positive initially. Any weakness in labor market data is seen increasing chances of pushing back an interest-rate hike, according to analysts.
Charles Evans, the president of the Chicago Federal Reserve and already a dovish outlier at the U.S. central bank, said Thursday he doesn’t want to increase interest rates until mid-2016, even later than his prior call of early in the year.
Earnings: Drugstore chain Walgreens Boots Alliance WBA, +4.24% jumped 4.2% after its third-quarter profit beat expectations.
Movers & shakers: Aluminum producer Alcoa Inc. AA, +0.86% unofficially kicked off the second-quarter earnings season on Wednesday, with an after-hours earnings report that beat analysts’ expectations on sales. Shares rose 0.9% Thursday.
For more on today’s notable movers read Movers & Shakers column.
Other markets: Crude oil CLQ5, +2.07% broke a five-session losing streak and rose 2.2%, to settle at $ 52.78 a barrel. Gold futures GCQ5, -0.37% fell below the $ 1,160 level, settling 0.4% lower at $ 1,159.20 an ounce. The ICE dollar index DXY, +0.24% rose 0.4% to 96.71, with the greenback trading mixed against other major currencies.