Stocks Finish With Second Straight Gain
NEW YORK (
)-- Stocks finished modestly higher Thursday led by strength in energy, materials and tech sectors.
The
Dow Jones Industrial Average
finished 8 points, or 0.1%, higher at 12,402. The blue-chip index swung wildly during the session, initially falling to a low of 12,317 and then rebounding to a session high of 12,441. The
S&P 500
rose by 5 points, or 0.4%, at 1326, and the
Nasdaq Composite
gained the most during Thursday's session, rising 21 points, or 0.8%, at 2782.
Basic materials and energy stocks saw some of the session's strongest gains as the dollar index declined 0.5%. It was the second straight positive day for the major indexes after severe selling in the three prior sessions.
Tech stocks also recorded strong gains with
Microsoft
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,
Hewlett-Packard
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topping the Dow along with
General Electric
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.
Shares of Microsoft gained more than 2% at $24.67.
Hedge fund titan David Einhorn called for CEO Steve Ballmer's exit
at an investment conference in New York on Wednesday.
Johnson & Johnson
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,
Home Depot
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and
Merck
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were the big losers on the Dow.
Earlier, investors got a raft of disappointing economic data. The Labor Department said
initial jobless claims rose by 10,000 to 424,000
in the week ended May21, disappointing expectations for decline of 9,000 claims, according to
Briefing.com
.
The Commerce Department said the
U.S.economy grew at an annualized rate of 1.8% in the first quarter
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, which was unchanged from its advanced estimate, and below the growth of 2% that economists had been expecting.
"Part of the blame for the soft first-quarter GDP data is due to transitory factors including bad weather and higher oil prices," said PNC Chief Economist Stuart Hoffman in a recent note. "In the second quarter, we have had more bad weather in the form of record-setting flooding and tornado activity. Added to the weather effects in Q2 is the drag from the Japan earthquake."
Chris Hobart, president and founder of Hobart Financial Group, said the disappointing data reveals that "we still have some significant fractures in the recovery."
"The jump in initial claims show that the recovery is still not resulting in substantial strength in the job market. Until companies extend higher revenues to the job market, this will be a slow, jobless recovery," he said.
Regarding recent market weakness, Hobart said,"Right now everything is coming to the surface. We still have problems in Europe, we still have a weak job market and consumer spending is slowing down. Global demand is slowing as reflected in our GDP, and it's all coming together at a time when the market naturally slows down during the summer months."
After initially coming under pressure on the weak data, stocks rebounded into the positive territory by the afternoon, although on lighter than usual volumes. Of the stocks listed on the New York Stock Exchange, 69% advanced while 28% declined. More than 700 million shares traded on the Big Board, and 1.7 billion shares changed hands on the Nasdaq.
Shares of
Freescale Semiconductor Holdings
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rose 1.8% to close at $18.40 after debuting on the NYSE at $19 a share, while shares of
Lone Pine Resources
(LPR)
, a subsidiary of oil and gas company
Forest Oil
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, shed 3% to $12.54 after opening at $12.45 on the NYSE.
Tiffany & Co.
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reported a 26% jump in first-quarter earnings and a 20% increase in sales, sending shares up 8.5% to$76.04.
Big Lots
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lowered its full-year outlook after first-quarter earnings declined and same-store sales fell
. The stock dropped 2.7% at $31.44.
Shares of
NetApp
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gained 6.9% to $55.31 after the
storage technology company reported a better-than-expected fourth-quarter profit
late Wednesday.
Los Angeles-based apparel company
Guess
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gave a strong outlook in addition to reporting consensus-beating earnings late Wednesday, sending shares up 11.1% to $44.57.
The July crude oil contract slipped $1.09 to settle at $100.82 a barrel.
shed $3.90 to settle at $1,523 an ounce.
The benchmark 10-year Treasury rose 17/32, diluting the yield to 3.066%.
The FTSE in London rose 0.2% while the DAX in Frankfurt dropped 0.8%. Japan's Nikkei jumped 1.5%, and Hong Kong's Hang Sengadded 0.7%.
-- Written by Melinda Peer and Shanthi Bharatwaj in New York
.
Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.
