Updated from 3:36 p.m. EST
Stocks in New York locked in 1%-2% gains Thursday, with financials and tech finding upside, as the promise of a stimulus package and next-step bank-relief effort played out alongside a mixed pot of retail declines, and an ugly set of economic data.
Led by gains in
Dow Jones Industrial Average
rose 106.41 points, or 1.3%, to 8063.07, and the
added 13.62 points, or 1.6%, to 845.85. The
tacked on 31.19 points, or 2.1%, to 1546.24.
The financial sector got a slight bump today, with KBW Bank index off its high, but still up 2.1%, after
reported that the Securities and Exchange Commission might be looking to suspend or restructure the so-called mark-to-market accounting rules that have punished banks' balance sheets as they struggle with the market value of distressed assets.
As to dealing with those distressed assets, on Monday, Treasury Secretary Tim Geithner will unveil the next banking-relief package, the aid measures for the financial industry, reportedly including some form of the "bad bank" concept, among other things.
In mid-afternoon trading,
Bank of America
, a possible beneficiary of the "bad bank" idea, pared its losses after dwindling to $4 a share earlier in the day.
said Thursday that it swung to a record $6.17 billion loss in the fourth quarter, in line with its preliminary estimate, and said the bank continues to see "very difficult conditions for the global economy, posing significant challenges for our clients and for our industry."
Sticking with earnings, investors appear to be shrugging off comments by
, which reported better-than-expected earnings on the one hand, but had a rather downbeat outlook on the other. The company said it now expects sales for the fiscal third quarter to be well below analysts' expectations.
Tech as a whole didn't seem to mind either, as shares were getting a slight boost on Thursday. The tech-centric
was rising almost 2%. Among the bigger movers,
added 17%, and
tacked on 10%
were rising 1.3% and 3.1%, respectively.
January retail sales numbers flooded headlines early Thursday. As expected, considering the economic environment, the majority are reporting moderate to steep declines -- some not as severe as expected, others more-so.
As a result, the declines definitely weren't one-size-fits all. For instance,
same store sales fell by 23.7%, while
saw just a 4.5% decline.
Furthering that idea, according to a tally by Thomson Reuters based on same-store sales, seven retailers it tracks surpassed expectations and five missed projections.
reported declines, but topped analyst estimates.
Companies that reported steeper-than-predicted declines in sales included
, Stage Stores and
Children's Place Retail Stores Inc.
reported that its same-store sales rose 2.2%, subsequently upping its expectations for fourth-quarter and full-year results. But investors weren't exactly crowing -- shares plummeted 16% early Thursday.
One definite bright spot was
, which said
same-store sales in January rose 2.1%, topping their own predictions for flat-to-2%, and Street expectations for 1.1% increases.
The company said it would no longer provide monthly sales forecasts -- shifting to a 13-week format -- because of the difficulty in predicting swings in consumer spending in the current volatile environment.
Turning to stimulus news, Washington is abuzz with a potential vote on President Barack Obama's historic economic stimulus package becoming near. U.S. Senate Majority Leader Harry Reid reportedly said the final vote could occur as early as Thursday night. On Wednesday senators unanimously approved an amendment that provides a $15,000 tax credit for homebuyers.
The latest economic data gave the country yet another reminder of the severity of the situation, as the Labor Department said Thursday the number of laid-off workers seeking jobless benefits rose last week to a seasonally adjusted 626,000, from 591,000 a week prior, and far exceeding analysts' expectations for 583,000.
Meanwhile, The Commerce Department said factory orders declined by 3.9% in December, outpacing economists' predictions for a 3% slide.
The banking and housing crises and the trade deficit are central culprits dragging the economy into recession and causing steep job losses, wrote Peter Morici, a professor at the University of Maryland School of Business and former chief economist at the U.S. International Trade Commission.
Morici predicts the proposed stimulus package, consisting of expansion of government programs, some infrastructure projects and personal and business tax cuts will give the economy a needed temporary lift the latter half of 2009 and into 2010 and 2011. However, he warns that "the package moving through Congress is too weighed down with special interest spending and tax breaks sought by lobbyists to replace any more than half of the jobs that will be lost by mid-2009."
In commodities, crude oil rose 85 cents to settle at $41.17, while gold gained $12 to settle at $914.20.
Longer-dated Treasuries were recently rising; the 10-year note adding 11.5/32 to yield 2.9%, the 30-year was gaining 1 03/32, yielding 3.6%.
The dollar was recently weaker against the yen, and stronger against the euro and pound.
Stocks overseas were mixed. In Europe, the FTSE in London and the DAX in Frankfurt were just atop the flat line. In Asia, Japan's Nikkei closed with a 1.1% loss, while Hong Kong's Hang Seng edged up 0.8% in the session.