U.S. Stocks Come Under Pressure After Seeing Initial Strength

After moving higher at the start of trading, stocks have come under pressure over the course of the trading session on Thursday. The major averages have pulled back well off their highs of the session and firmly into negative territory.

The major averages have climbed off their worst levels in recent trading but continue to post steep losses. The Dow is down 405.30 points or 1.6 percent at 25,661.98, the Nasdaq is down 68.03 points or 0.7 percent at 10,424.47 and the S&P 500 is down 37.28 points or 1.2 percent at 3,132.66.

Profit taking has contributed to the downturn on Wall Street, as the pullback by the major averages came after the tech-heavy Nasdaq reached a new record intraday high.

Traders also continue to express some concerns about the recent spike in coronavirus cases, with Florida reporting a record increase in hospitalizations.

Meanwhile, the markets have largely shrugged off a report from the Labor Department showing a bigger t than expected decrease in first-time claims for U.S. unemployment benefits.

The report said initial jobless claims tumbled to 1.314 million, a decrease of 99,000 from the previous week's revised level of 1.413 million.

Economists had expected jobless claims to slump to 1.375 million from the 1.427 million originally reported for the previous week.

Airline stocks have shown a substantial move to the downside on the day, dragging the NYSE Arca Airline Index down by 5.2 percent.

Significant weakness has also emerged among energy stocks, which are moving sharply lower along with the price of crude oil. Crude for August delivery is plunging $1.35 to $39.55 a barrel.

Reflecting the weakness in the energy sector, the NYSE Arca Oil Index is down by 4.3 percent, the Philadelphia Oil Service Index is down by 3.4 percent and the NYSE Arca Natural Gas Index is down by 2.9 percent.

Financial, utilities and gold stocks are also seeing considerable weakness on the day, moving lower along with most of the other major sectors.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Thursday. Japan's Nikkei 225 Index rose by 0.4 percent, while China's Shanghai Composite Index jumped by 1.4 percent.

Meanwhile, the major European markets have turned mixed on the day. While the German DAX Index has climbed by 0.6 percent, the French CAC 40 Index is down by 0.5 percent and the U.K.'s FTSE 100 Index is down by 1.2 percent.

In the bond market, treasuries have moved to the upside after ending the previous session nearly flat. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 3.1 basis points at 0.622 percent.