Stocks Finish Higher on Promising Economic Data

NEW YORK ( TheStreet) -- U.S. stocks finished with solid gains on Thursday as a batch of positive economic data helped get November's trading off to a strong start.

After a two-day freezeout due to Hurricane Sandy, Wall Street reconvened with a mixed session on Wednesday. Investors found reason to rally Thursday though as the latest reads on the employment picture fostered optimism about Friday's October jobs report, the last big piece of economic data ahead of the Nov. 6 presidential election.

The Dow Jones Industrial Average gained a little more than 136 points, or 1.04%, to close at 13,232. The blue-chip index posted a roughly 2% loss in October, its worst monthly performance since May.

Breadth within the Dow was overwhelmingly positive as winners beat losers, 26 to 3 with McDonald's ( MCD) finishing flat. The biggest percentage gainers were Bank of America ( BAC), Caterpillar ( CAT), and Microsoft ( MSFT).

The trio of Dow decliners were Pfizer ( PFE), Travelers Cos. ( TRV), and Wal-Mart Stores ( WMT).

Shares of Exxon Mobil ( XOM) added 0.47% after the oil and gas giant reported third-quarter adjusted earnings of $2.09 a share, ahead of Wall Street's consensus view. The company also unveiled plans to repurchase $5 billion worth of its common stock in the fourth quarter.

Pfizer's stock closed down 1.3% after the drug giant posted a 14% year-over-year decline in third-quarter earnings as sales of its cholesterol drug Lipitor fell sharply. The company also lowered its per-share guidance to a range of $2.14 to $2.17 on revenue of $58 billion to $59 billion from a previous $2.14 to $2.22 on revenue of $58 billion to $60 billion.

Shares of Travelers fell 1%, extending its weakness into a second day as investors remained timid about magnitude of the losses the insurance company may incur in the wake of Hurricane Sandy.

The S&P 500 added more than 15 points, or 1.09%, to close at 1428, while the Nasdaq climbed nearly 43 points, or 1.44%, to settle at 3020.

Advancers outpaced decliners by a 3.3-to-1 ratio on the Big Board and 1.9-to-1 ratio on the Nasdaq. Volume totaled 3.89 billion on the New York Stock Exchange and 1.8 billion on the Nasdaq.

Thursday saw two pieces of jobs-related data. ADP reported private payrolls rose by 158,000 jobs in October, edging the consensus estimate of 155,000 compiled by Econoday. It's worth noting that the ADP has switched to Moody's as its economic consultant to revamp the data.

Also, initial jobless claims fell 23,000 to 363,000 in the week ended Oct. 20, although the four-week moving average ticked up for the second consecutive week to 368,000. The prior week's claims were revised to 372,000, a 46,000 jump.

Meantime, consumer confidence improved to 72.2 in October, which was up from 68.4 in September, but was a little softer than the 74 reading analysts expected.

Nonfarm business productivity for the third quarter increased 1.9% as the second-quarter number was revised upward to 2.2%, which was in step with the revision to gross domestic product. Labor costs dipped 0.1%; the consensus was for a 1.2% increase, according to Econoday.

The FTSE 100 in London jumped 1.37%, helped in part by Shell's earnings, while the DAX in Germany closed up 1.03%. Asian markets received a jolt after China's October manufacturing PMI reading reached an eight-month high of 49.5, which was up from a prior month 47.9 and beat the 49.1 consensus among economists polled by Econoday.

Japan's Nikkei average rose 0.21% overnight to close at 8947. Hong Kong's Hang Seng rose 0.83% to 21,821.

Gold for December delivery shed $3.60 to settle at $1,715.50 an ounce at the Comex division of the New York Mercantile Exchange, while December crude oil contracts closed up 85 cents to $87.09 a barrel.

The benchmark 10-year Treasury dipped 8/32, boosting the yield to 1.725%. The dollar was up 0.10%, according to the U.S. dollar index.

Elsewhere on the corporate news front, Royal Dutch Shell, the U.K. oil giant, reported that third-quarter core earnings declined 15% as oil and gas prices fell, but saw a 2.3% increase in third-quarter profit thanks to higher earnings from its liquefied natural gas operations.

Also, U.S. retailers reported October sales rose 4.7%, compared to a final estimate of analysts who expected 4.3%, according to Thomson Reuters. Wholesale giant Costco ( COST) said same-store sales rose 7% in October, which beat analysts' estimates, but its stock dipped 1.3%.

Automaker Ford ( F) reported that its total retail sales grew 2% in October, with cars and utilities up 2%, and F-Series pickups up 8%. Shares of Ford increased 0.81%.

General Motors ( GM) posted an October monthly U.S. sales increase of 5% year over year. Sales to fleet customers were off 2%. Shares ticked up 0.71%.

Chrysler, owned by Italian automotive manufacturer Fiat, reported October U.S. car sales gained 10%, but analysts polled by Bloomberg were looking for a 15% bump.

Visa ( V) reported quarterly net income of $1.7 billion, or $2.47 a share. Shares of the credit card company gained 3.7%.

Allstate ( ALL) the largest publicly traded U.S. auto and home insurer, reported net income totaled $723 million in its latest quarter, up from $175 million a year earlier. Operating income was $1.46 a share, which beat a Bloomberg survey of economists who expected $1.13. Shares fell 2.3%.

Shares of Kellogg ( K) rose more than 2% after the cereal maker reported revenue of $3.72 billion on a third-quarter profit of $296 million, or 82 cents a share, which was higher than a year-earlier result of $290 million, or 80 cents a share. Analysts polled by Thomson Reuters expected earnings of 80 cents a share on revenue of $3.69 billion.

Sirius XM ( SIRI) reported Thursday that its third-quarter profit dropped to $74.5 million, or 1 cent a share, from a year-earlier result of $104.2 million, or 2 cents a share. Revenue rose 14% to $867.4 million, which was slightly better than analysts' expectations of $866.1 million, as polled by Bloomberg. The stock added less than 1%.

After Thursday's closing bell, insurance giant AIG ( AIG) reported a profit of $1.13 a share against a year-ago per share loss of $2.10. Shares of the company were down 1.2% in after-hours action.

Also, coffee chain Starbucks ( SSBUX) announced a quarterly profit of 46 cents a share on revenue of $3.36 billion and hiked its fiscal 2013 earnings forecast to a profit of $2.06 to $2.15 a share. The company, whose stock was up more than 6% in the extended session, also lifted its quarterly dividend by more than 20%.

-- Written by Joe Deaux in New York.

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