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Wall Street: Stocks rise following economic data

Published August 29, 2013 1:12 pm

This is an archived article that was published on sltrib.com in 2013, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

NEW YORK • The stock market rose Thursday as investors weighed positive economic reports against worries about Syria.

The Dow Jones industrial average added 78 points, or 0.5 percent, to 14,902 in late morning trading, while the Standard & Poor's 500 index was up 10 points, or 0.6 percent, at 1,645. The Nasdaq composite saw sharper gains, rising 37 points, or 1.1 percent, to 3,631.

Verizon Communications was the biggest gainer in both the Dow and the S&P 500 after Britain's Vodafone confirmed it was in talks with Verizon to sell its 45 percent stake their joint venture, Verizon Wireless.

Verizon rose $1.72, or 4 percent to $48.28. The U.S.-listed shares of Vodafone rose $2.42, or 8 percent, to $31.82 on the news.

After selling off sharply Tuesday, stocks have almost completely recovered their losses from two days ago. While fund managers said they're not looking to jump into this market, some individual companies are starting to look attractive again.

"If you're a long-term investor, it's an opportunity," said Richard Sichel, chief investment officer at Philadelphia Trust Co., which has $1.9 billion under management. He noted a new investment retail chain, PetSmart, as an example.

Traders focused on economic data that came out early Thursday. The U.S. economy grew at a 2.5 percent annual rate from April through June, much faster than previously estimated, the government said. The figure was revised up from 1.7 percent as more U.S. companies exported goods and imports declined.

Also, the Labor Department said the number of people who filed for unemployment benefits last week fell to 331,000, the fewest in five years.

"It does support our belief that August was another month of steady employment growth," economists with the investment bank RBS wrote in a research report.

While lower unemployment claims and an upward revision on GDP are both positive signs, most of Wall Street's attention is focused on next week, when the August jobs report will be released. The Federal Reserve is expected to decide the fate of its massive bond-buying program in mid-September, and the jobs report will be the last bit of significant economic data the Fed will have to consider before making its decision.

The yield on the benchmark 10-year Treasury note rose to 2.80 percent from 2.77 percent on Wednesday following the stronger economic reports.

Traders also continue to watch Syria, where a U.S-led strike could happen in the coming days.

Investors worry that a limited strike against Syria could drag the U.S. and its allies into that nation's civil war, or worse, set off a regional conflict in an area where so much of the world's oil is located.

The price of crude oil fell 84 cents, or 0.9 percent, to $109.24 a barrel. Oil had climbed as high as $112 earlier this week.

In other corporate news, teen clothing store operator Guess jumped $3.48, or 12.7 percent, to $30.79 after the company reported second-quarter profit and revenue late Wednesday that blew past the expectations of Wall Street analysts. The retailer also raised its profit forecast for the year.

Campbell Soup fell $1.40, or 3.1 percent, to $43.30 after posting a loss for its fiscal fourth quarter. The company's results were dragged down by a charge related to the potential sale of a European business. While the results topped Wall Street's estimates, revenue missed expectations.