Midday Market Update: What’s Causing the Market’s Fluctuations?
June 4th at 10:00am by Tom Lydon
U.S. stocks and exchange traded funds (ETFs) are fluctuating this morning as investors are looking for stronger and more convincing indicators that the economy is improving.
On the positive side, the number of jobless claims fell last week to 621,000 from 625,000, marking the first fall in claims in 20 weeks. This data gave a slight nudge in the direction that the unemployment woes suffered by the United States are starting to ease. Tomorrow’s report outlining total monthly job losses by the Labor Department will be the real indicator of whether or not unemployment numbers are easing.
Although the jobless claims report sent the markets in the black, disappointing news from the retail sector ate up these gains and sent the markets back down. In May, U.S. retailers reported that same-store sales fell below expectations, indicating that consumers are still wary of the economy and are cautious about spending. Same-store sales are an important indicator of consumer spending, which makes up nearly 70% of all U.S. economic activity, states Mae Anderson of the Associated Press. This news sent the Retail HOLDRs (RTH) down about 2% in morning trading.
Black gold continued its three-month rally, sending the price of crude north of $68/barrel on the New York Mercantile Exchange. The volatile commodity continues to remain strong despite a report by the Energy Information Administration indicating demand for crude is still sluggish. The United States Oil Fund (USO) gained nearly 4% in intraday trading.
Overall, activity in the markets is pretty slow this morning. After oscillating between positive and negative territory, the Dow Jones Industrial Average gained 0.2%, while the S&P 500 and Nasdaq both jumped nearly 0.4% in morning trading.
Kevin Grewal contributed to this article.
