After moving sharply higher early in the session, stocks showed a substantial downturn over the course of the trading day on Thursday. The volatility on the day extended the rollercoaster ride the major averages have been on throughout the week.<\/p>\n
The tech-heavy Nasdaq jumped as much as 1.7 percent in early trading but ended the day down 189.34 points or 1.4 percent at 13,352.78, its lowest closing level in eight months.<\/p>\n
The S&P 500 also slid 23.42 points or 0.5 percent to a nearly four-month closing low of 4,326.51 after surging as much as 1.8 percent.<\/p>\n
The narrower Dow posted a more modest loss, edging down 7.31 points or less than a tenth of a percent to 34,160.78. The blue chip index was up more than 600 points or 1.8 percent at its best levels of the day.<\/p>\n
Stocks continued to experience intense volatility as traders weighed upbeat fourth quarter GDP against the prospect of higher interest rates.<\/p>\n
The markets<\/span> initially showed a positive reaction to a Commerce Department report showing stronger than expected GDP growth in the fourth quarter of 2021.<\/p>\n However, traders have recently shown a reluctance to maintain any meaningful moves, resulting in another rollercoaster ride on Wall Street.<\/p>\n The report showed real gross domestic product spiked by 6.9 percent in the fourth quarter after jumping by 2.3 percent in the third quarter. Economists had expected GDP to surge up by 5.5 percent.<\/p>\n Economists pointed out the strong GDP growth was primarily due to a massive surge in business<\/span> inventories, which added 4.9 percentage points, the second largest contribution since 1987. <\/p>\n “While normally such a large inventory build would be very negative for future growth, in today’s environment it points to an easing of supply-chain snarls and means consumers will have more products to purchase once the winter lull passes,” said Kathy Bostjancic, Chief U.S. Financial Economist at Oxford Economics.<\/p>\n The Labor Department also released a report showing initial jobless claims pulled back in the week ended January 22nd following a bigger than expected increase in the previous week.<\/p>\n The report said initial jobless claims fell to 260,000, a decrease of 30,000 from the previous week’s revised level of 290,000. Economists had expected jobless claims to drop to 260,000 from the 286,000 originally reported for the previous week.<\/p>\n Meanwhile, separate reports from the Commerce Department and the National Association of Realtors showed steeper than expected drops in durable goods orders and pending home sales in the month of December.<\/p>\n Sector News<\/p>\n Semiconductor stocks moved sharply lower over the course of the session, dragging the Philadelphia Semiconductor Index down by 4.8 percent to its lowest closing level in over three months.<\/p>\n Industry giant Intel (INTC) led the sector lower, plunging by 7 percent after reporting better than expected fourth quarter results but providing a mixed outlook.<\/p>\n Substantial weakness also emerged among gold stocks, as reflected by the 2.6 percent slump by the NYSE Arca Gold Bugs Index. <\/p>\n The sell-off by gold stocks came amid another steep drop by the price of the precious metal, with gold for February delivery plunging $36.60 to $1,793.10 an ounce.<\/p>\n Biotechnology, networking and housing stocks also came under pressure over the course of the session, while significant strength remained visible among pharmaceutical and oil stocks.<\/p>\n Other Markets<\/p>\n In overseas trading, stock markets across the Asia-Pacific region moved sharply lower during trading on Thursday. Japan’s Nikkei 225 Index plummeted by 3.1 percent, while China’s Shanghai Composite Index tumbled by 1.8 percent.<\/p>\n Meanwhile, the major European markets moved to the upside after seeing early weakness. While the U.K.’s FTSE 100 Index jumped by 1.1 percent, the French CAC 40 Index and the German DAX Index rose by 0.6 percent and 0.4 percent, respectively.<\/p>\n In the bond market, treasuries regained ground after coming under pressure going into the close of the previous session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, slid 4.1 basis points to 1.807 percent.<\/p>\n Looking Ahead<\/p>\n Earnings news may take the spotlight on Friday, with tech giant Apple (AAPL) among the companies releasing their quarterly results after the close of today’s trading.<\/p>\n Caterpillar (CAT), Chevron (CVX), and Colgate-Palmolive (CL) are also among the companies due to report their quarterly results before the start of trading on Friday.<\/p>\n Following the slew of data released this morning, the economic calendar is comparatively quiet on Friday, although traders are still likely to keep an eye on reports on personal income and spending and consumer sentiment. <\/p>\n