U.S. Stocks Pull Back Off Best Levels But Still Close Higher

(RTTNews) - After turning in a strong performance for much of the session, stocks gave back some ground in the latter part of the trading day on Thursday but managed to remain mostly higher.

The major averages all ended the day in positive territory, regaining some ground following the pullback seen over the two previous sessions.

The Dow advanced 292.81 points or 0.6 percent to 49,442.44, the Nasdaq climbed 58.27 points or 0.3 percent to 23,530.02 and the S&P 500 rose 17.87 points or 0.3 percent to 6,944.47.

The early strength on Wall Street partly reflected a positive reaction to earnings news from Taiwan Semiconductor (TSM), with the chipmaker surging by 4.4 percent.

Taiwan Semiconductor jumped after reporting a sharp increase in fourth quarter profits and announced larger-than-expected capital spending plans, contributing to renewed confidence in the artificial intelligence trade.

"After last week's revenue update it was an open secret that TSMC would be reporting a record quarter but the details are still striking," said Russ Mould, investment director at AJ Bell.

"Not least the levels of capital expenditure TSMC is committing to, suggesting it is fully confident the AI boom has legs," he added. "This is underlined by the company's guidance for 30% growth in 2026."

Positive sentiment may also have been generated in reaction to a Labor Department report showing first-time claims for U.S. unemployment benefits unexpectedly dipped in the week ended January 10th.

The Labor Department said initial jobless claims fell to 198,000, a decrease of 9,000 from the previous week's revised level of 207,000.

Economists had expected jobless claims to rise to 215,000 from the 208,000 originally reported for the previous week.

Sector News

Airline stocks showed a significant move to the upside on the day, with the NYSE Arca Airline Index surging by 2.6 percent.

Notable strength also remained visible among semiconductor stocks, as reflected by the 1.8 percent gain posted by the Philadelphia Semiconductor Index.

Financial, networking and utilities stocks also turned in strong performances, while pharmaceutical, oil and biotechnology stocks moved to the downside.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Thursday. Japan's Nikkei 225 Index fell by 0.4 percent and China's Shanghai Composite Index dipped by 0.3 percent, while South Korea's Kospi jumped by 1.6 percent.

The major European markets are also mixed on the day. While the French CAC 40 Index slipped by 0.2 percent, the German DAX Index rose by 0.3 percent and the U.K.'s FTSE 100 Index climbed by 0.5 percent.

In the bond market, treasuries gave back ground after moving higher over the two previous sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose 2.0 basis points to 4.160 percent.