Stocks Regain Ground As Market Stays On Bumpy Path
Stocks held on to a tentative advance late Thursday as investors tried to reconcile another batch of conflicting economic signals.
The Dow Jones industrial average rose 11 points after being down more than 100 earlier. Broader indexes were narrowly mixed.
Stocks continued a now months-long pattern of erratic trading. Investors have been torn between buying on companies' upbeat earnings and forecasts, and selling on economic reports that point to an uncertain recovery.
That indecision was clear Thursday. Stocks first rose on earnings reports from Southwest Airlines Co., ExxonMobil Corp., Avon Products Inc. and Sony Corp. all, of which topped earnings forecasts. But disappointment over what was just a slight drop in initial claims for unemployment benefits sent stocks falling. Traders were also uneasy ahead of the first reading on the gross domestic product for the April-June quarter, to be released Friday.
"This is a market that is trying to ascertain how deep the downturn is going to be and it is a market that's future-looking," said Quincy Krosby, a market strategist with Prudential Financial.
"It's looking at numbers five to six months from now, trying to get a portrait of the economy and where earnings are going to be. Until it gets clarity on that its going to be a choppy market."
There was little to help traders get that clarity Thursday. The Labor Department said initial claims for unemployment benefits dropped by a modest 11,000 to 457,000 last week. That's slightly better than the 459,000 forecast by economists polled by Thomson Reuters, but investors were disappointed because the drop was so small.
"They saw it was more of the same," said Bryan Jordan, director of financial markets analysis at Nationwide Investments. "This is an unusually stagnant labor market."
In the last hour of trading, the Dow rose 11.51, or 0.1 percent, to 10,509.31. The Standard & Poor's 500 index rose 0.35, or 0.03 percent, to 1,106.48. The Nasdaq composite index rose 0.74, or 0.03 percent,to 2,265.30.
Winning stocks were ahead of losers by about 3 to 2 on the New York Stock Exchange. Volume was light at 826 million shares. Lighter volume tends to skew price moves.
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