Stocks continued an uneventful week on Thursday, as most major indexes finished slightly down on light trading volumes. After a lack of meaningful data in previous sessions, there was an abundance of good news on Thursday. Initial claims for unemployment dropped to the lowest level in more than two years last week according to Labor Department data. That development was encouraging for investors, who have watched stocks rally in recent weeks despite any evidence of job creation in the U.S. economy. Separately, better-than-expected results for pending home sales also boosted sentiment.
The U.S. dollar came under pressure on Thursday, as central banks in South Korea, Thailand, and Malaysia intervened in currency markets after a stronger outlook for Asian economies in 2011 prompted big gains against the greenback.
One of the biggest winners on Thursday was the iPath Dow Jones-UBS Copper ETN (JJC), which climbed another 1.6% to continue an impressive rally. Copper futures for March delivery jumped to more than $4.36 per pound, setting a new high for the commodity once again. Copper’s Thursday gains were fueled by increasingly optimistic outlooks for the Chinese economy in 2011, as both RBC and Templeton Emerging Market Group’s Mark Mobius issued bullish statements. China is the world’s largest consumer of copper [see An ETF to Invest Like Mark Mobius].
Losing ground on Thursday were Japanese equities, which slid as the yen climbed to a seven-week high against the greenback. A stronger yen makes Japanese exports–a critical part of the economy–more expensive to international consumers. Despite various efforts from the Japanese government (including intervention in currency markets), the yen has steadily climbed this year. The iShares MSCI Japan Index Fund (EWJ) lost 0.8% on the day, as all but one ETF in the Japan Equities ETFdb Category finished Thursday in the red.
Disclosure: No positions at time of writing.