US stocks rise

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IOL wall street THE PHOTO HOLIC File image

US stocks headed higher Thursday as investors shrugged off disappointing government economic data on jobs and inflation and kept an eye on Europe's expanding debt crisis.

A Moody's downgrade on Spain's debt late Wednesday and Sunday's Greek election that could see the country exit the eurozone had markets on edge.

Accelerating opening gains, the Dow Jones Industrial Average was up 77.27 points, or 0.62 percent, to 12,573.65 after the first half hour of trade.

The S&P 500-stock index advanced 7.10 (0.54 percent) to 1,321.98, while the tech-heavy Nasdaq Composite reversed declines and added 9.04 (0.32 percent) to 2,827.65.

“Continued eurozone debt crisis uneasiness is being met with some disappointing US economic data,” Charles Schwab & Co. analysts said.

Weekly initial jobless claims rose more than expected and consumer prices fell in May for the first time in two years, driven by falling gasoline prices, but core inflation rose 0.2 percent for the third straight month.

“Lower energy costs are keeping money in peoples' pockets and they need that given the slowdown in the labor market,” said Joel Naroff of Naroff Economic Advisors.

Financials were mixed. Blue-chip Bank of America gained 0.4

percent, Wells Fargo rose 0.5 percent and JPMorgan Chase added 0.2

percent, but Morgan Stanley fell 0.7 percent

Dow member United Technologies rose 0.7 percent after raising its quarterly dividend.

Smithfield Foods slumped 3.4 percent after quarterly earnings missed expectations.

On Wednesday, weak May retail sales data hit investor sentiment. The Dow dropped 0.6 percent, the S&P 500 0.7 percent and the Nasdaq 0.9 percent.

Bonds were flat. The yield on the 10-year Treasury bond was unchanged at 1.60 percent from Wednesday, while the 30-year bond slipped to 2.70 percent from 2.71 percent.

Bond prices and yields move in opposite directions. - Sapa-AFP

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