WASHINGTON (dpa-AFX) - After recovering from an early move to the downside, stocks showed a lack of direction over the course of the trading session on Thursday. The major averages spent the day bouncing back and forth across the unchanged line before eventually closing narrowly mixed.
While the S&P 500 crept up 1.96 points or less than a tenth of a percent to a new record closing high of 6,468.54, the Nasdaq edged down 2.47 points or less than a tenth of a percent to 21,710.67 and the Dow slipped 11.01 points or less than a tenth of a percent to 44,911.26.
The early weakness on Wall Street came following the release of a Labor Department report showing producer prices in the U.S. increased by much more than expected in the month of July.
The Labor Department said its producer price index for final demand shot up by 0.9 percent in July after coming in unchanged in June. Economists had expected producer prices to rise by 0.2 percent.
The report also showed a substantial acceleration by the annual rate of producer price growth, which surged to 3.3 percent in July from an upwardly revised 2.4 percent in June.
Economists had expected the annual rate of producer price growth to increase to 2.5 percent from the 2.3 percent originally reported for the previous month.
The hotter-than-expected producer price inflation data partly offset optimism about a September interest rate cut generated by the consumer price inflation data released earlier this week.
However, CME Group's FedWatch Tool is currently still indicating a 92.6 percent chance the Federal Reserve will lower rates by a quarter point next month, which helped keep selling pressure relatively subdued.
The Labor Department also released a separate report unexpectedly showing a modest decrease by first-time claims for U.S. unemployment benefits in the week ended August 9th.
The report said initial jobless claims dipped to 224,000, a decrease of 3,000 from the previous week's revised level of 227,000.
Economists had expected jobless claims to inch up to 228,000 from the 226,000 originally reported for the previous week.
Sector News
Despite the lackluster performance by the broader markets, networking stocks saw significant weakness, with the NYSE Arca Networking Index tumbling by 2.4 percent after ending the previous session at a record closing high.
Considerable weakness was also visible among computer hardware stocks, as reflected by the 2.1 percent slump by the NYSE Arca Computer Hardware Index.
Steel, airline and housing stocks have also shown notable moves to the downside, while pharmaceutical, retail and banking stocks some strength on the day.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Thursday. Japan's Nikkei 225 Index slumped by 1.5 percent, while China's Shanghai Composite Index fell by 0.5 percent.
Meanwhile, the major European markets moved to the upside on the day. While the U.K.'s FTSE 100 Index inched up by 0.1 percent, the French CAC 40 Index and the German DAX Index both advance dby 0.8 percent.
In the bond market, treasuries gave back ground in reaction to the hotter-than-expected wholesale inflation data. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 3.3 basis points at 4.273 percent.
Looking Ahead
Trading on Friday may be impacted by reaction to a slew of U.S. economic data, including reports on retail sales, industrial production and consumer sentiment.
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