US close: Stocks close higher despite surprise uptick in jobless claims

Wall Street stocks closed higher on Thursday despite a surprise increase in weekly jobless claims.

At the close, the Dow Jones Industrial Average was up 0.07% at 34,823.35, while the S&P 500 was 0.20% firmer at 4,367.48 and the Nasdaq Composite saw out the session 0.36% stronger at 14,684.60.

The Dow closed 25.35 points higher on Thursday as strong second-quarter earnings continued to flow in.

The yield on the benchmark 10-year Treasury note was slightly higher on Thursday at 1.29%, up from the 1.17% seen earlier in the week that startled investors.

As always, market participants were digesting this week's jobless claims report, this time revealing that first time unemployment claims in the US bounced back unexpectedly in the week ended 17 July, pushed higher by the annual retooling of automakers.

According to the Department of Labor, the seasonally adjusted number of initial jobless claims rose by 50,000 over the week ended 17 July to 419,000. Economists had pencilled-in a reading of 350,000. Data for the previous week was also upwardly revised by 8,000 to 368,000, while the four-week moving average of initial claims meanwhile was little changed, up 750 to 385,520, and secondary claims for the week ended 10 July dipped 29,000 to approximately 3.24m for their lowest reading since 21 March 2020.

Economic reopening plays were also in focus, with names like Royal Caribbean trading lower, while investors were also eyeing energy stocks after oil rebounded back above $70 a barrel and bank shares as a result of the more stable yields.

Also in the corporate space, second-quarter earnings from AT&T topped analysts estimates, while CSX shares advanced after the railroad operator said second-quarter profits more than doubled.

Going the other way, Texas Instruments was weighing on tech stocks after the chipmaker topped expectations but cautioned that third-quarter results would likely fall short of estimates.

On the macro front, the Chicago Fed's national activity index declined to 0.09 in June, down from 0.26 in May, with three broad categories of indicators used to construct the index making positive contributions in June, but with two categories deteriorating when compared to May.

Elsewhere, the Conference Board's leading index improved 0.7% to 115.1 in June, just shy of consensus estimates for a reading of 1.0% and last month's revised print of 1.2%.

Still on data, US home sales bounced back in June following four consecutive monthly declines, however, the pace was moderate as higher prices and low inventory continued to weigh on the property market. Existing home sales increased 1.4% to a seasonally adjusted annual rate of 5.86m units last month, according to the National Association of Realtors, with sales rising in the Northeast, West and Midwest.

Lastly, the Kansas Fed's July manufacturing index came in at 41, up from a reading of the 30 a month earlier.