|Wall Street up as claims data boost optimism ahead of payrolls|
|Thursday, 04 October 2012 14:54|
U.S. stocks rose on Thursday with the S&P up for a fourth session, after data suggested improvement in the labor market ahead of Friday's closely watched monthly payrolls report.The number of Americans filing new claims for unemployment benefits rose only slightly last week after a big drop the week before, keeping in place a trend that indicated a mild improvement in the labor market.
The S&P 500 has climbed 16 percent so far this year. That strong gain, combined with weak global economic data and questions of whether Spain's bailout will come to pass, have prompted some investors to say the rally is starting to look overextended.
"The bulls have control over this market, clearly. When there is no terrible news, the market goes up," said Uri Landesman, president of Platinum Partners in New York.
"U.S. equities is considered as flight to quality, which is quite surprising considering the fact that the economy is not that strong."
The Federal Reserve may adopt numerical thresholds for inflation and joblessness that would serve as guideposts for policy, according to minutes from a September meeting that revealed some reticence about the U.S. central bank's latest stimulus.
The Dow Jones industrial average .DJI gained 80.77 points, or 0.60 percent, to 13,575.38. The Standard & Poor's 500 Index .SPX gained 9.63 points, or 0.66 percent, to 1,460.62. The Nasdaq Composite Index .IXIC gained 9.13 points, or 0.29 percent, to 3,144.36.
Initial claims for state unemployment benefits rose 4,000 to a seasonally adjusted 367,000, the Labor Department said, below economists' expectations for an increase to 370,000.
"The claims data was actually OK, with two weeks in a row now below 370,000, after two weeks prior above 380,000," said Peter Boockvar, equity strategist and portfolio manager at Miller Tabak in New York. "We await obviously tomorrow's payrolls number."
Coal companies' stocks rallied following Republican presidential nominee Mitt Romney's support of the coal industry during his televised debate with President Barack Obama on Wednesday night.
Financial shares led the market higher after Draghi said the ECB was ready to buy the bonds of euro zone countries that ask for it, leaving the door open to a widely expected bailout of Spain. The S&P's financial index .GSPF gained 1.3 percent.
Draghi, speaking at a regular monthly news conference, also said "significant progress" had been made in Spain to bring order to its finances, although more was needed.
The weaker dollar lifted the prices of crude and basic metals, which helped buoy shares in the energy and materials sectors. An S&P index of energy shares .GSPE rose 1 percent, while an S&P index of materials shares .GSPM gained 1.3 percent.
Data showed U.S. retailers' September sales looked solid as shoppers wrapped up back-to-school buying and put the brakes on more big spending before the holiday season.
Costco Wholesale (COST.O) shares rose 1.8 percent to $101.42 after it reported a better-than-expected 6 percent rise in September sales at stores open at least a year.