Dow up 72 as better jobs picture boosts stocks

The blue chips break a 4-day losing streak as jobless claims fall. Gold and oil jump on Netanyahu's Iran warnings. Tech stocks rebound from Wednesday's losses. Research In Motion soars on earnings beat; Nike falls back as earnings slip.

By Charley Blaine Sep 27, 2012 12:33PM
Charley BlaineUpdated: 7:39 p.m. ET

Stocks enjoyed a solid rally today, the first of the week, as U.S. jobless claims showed a surprisingly large decline and investors cheered Spain's budgetary plans.

While jobless claims fell, the Labor Department also reported that job gains for the year ended in March were larger than thought. But the government also reported a decline in durable-goods orders that was made worse by a big decline in commercial aircraft orders. In addition, a new measure of second-quarter growth showed the big 2012 drought was already weighing on the economy.

Homebuilding, energy and technology stocks were among the market leaders today, a day after all had pulled back. Gold (-GC) and crude oil (-CL) moved higher in part because of worries about an Iranian-Israeli war and as the dollar fell against the euro and the British pound. Energy stocks were higher.

After the close, Research In Motion (RIMM) shares jumped $1.56, or nearly 22%, to $8.70 after reporting one-time charges of 27 cents a share. Wall Street was looking for 19 cents. Revenue was $2.9 billion, up 2% from a year ago. Nike (NKE) shares were off $2.09 to $93.91 after hours. The company reported a 12% profit decline, although revenue was up 10% to $6.67 billion. Worldwide future orders were up 6% from a year ago, but Nike's gross profit margin fell to 43.5% from 44.3% a year ago.

The Dow Jones industrials ($INDU) closed up 72 points to 13,486; the blue chips had been up as many as 109 points. The Standard & Poor's 500 Index ($INX) gained 14 points to 1,447, and the Nasdaq Composite Index ($COMPX) gained 43 points to 3,137. The Nasdaq-100 Index ($NDX) had risen 40 points to 2,822.

Article continues below.
Apple
(AAPL), the biggest influence on the Nasdaq-100, climbed $16.14 to $681.32, gaining back all it had lost on Wednesday. Amazon.com (AMZN) gained $6.92 to $256.59, and Google (GOOG) was up $3.04 to $756.50.

Today's gains left the major averages poised to finish September with decent gains, although the market looks to end the week lower.

The gains for the Dow and S&P 500 were their largest since Sept. 13. The Nasdaq's gain was its largest since Sept. 6.

The Dow heads into Friday, the last trading day of the month, up 3.1% for September. The S&P 500 is up 2.9%, while the Nasdaq is up 2.3%.

If the Dow ends September with a gain, it will be the 11th for the blue chips in the last 12 months, something not seen since March 1958 through February 1959.

Personal income, Chicago PMI, Michigan consumer confidence reports due
Friday offers a full plate of economic reports, including reports on personal income and spending, the Chicago Purchasing Managers Index and the University of Michigan Consumer Sentiment Index.

Earnings are due from American Greetings (AM) and pharmacy retailer Walgreen (WAG).

American Greetings shares were up 34 cents to $17.01 after an investment group led by CEO Zev Weiss and his family on Wednesday offered $17.18 a share for the company, a 20% premium over Tuesday's close.

Futures trading suggests a modestly higher open for stocks on Friday.

Natanyahu speech boosts gold, energy prices
Precious metals and energy prices were higher today, in part because of the United Nations speech of Israeli Prime Minister Benjamin Netanyahu., who said Iran could have enough enriched uranium for a nuclear weapon by next summer.

The possibility of Iran’s possession of a nuclear weapon was a threat not only to Israel but to the entire world, Netanyahu said, and added that the failure to establish "red lines" for Tehran could lead to war. Netanyahu has been arguing for months that Iran must be stopped.

Thanks to his speech, gold settled up $26.90 to $1,780.50 an ounce.

Crude oil in New York settled up $1.87 to $91.85 a barrel, and futures of heating oil, natural gas and wholesale gasoline jumped as well. Brent crude, the benchmark North Sea oil that tends to move global oil prices, was up $2.19 to $112.36 a barrel.

The national average retail price of gasoline was down a penny to $3.795 a gallon, according to AAA's Daily Fuel Gauge Report.

Energy prices -- New York close



Thur.

Wed.

Month chg.

YTD chg.
Crude oil (-CL)

$91.85

$89.98

-4.79%

-7.06%
(per barrel)











Heating oil (-HO)

$3.1508

$3.1025

-0.92%

8.12%
(per gallon)











Natural gas (-NG)

$3.2970

$3.2150

17.79%

10.30%
(per mil. BTU)











Unleaded gasoline (-RB)

$2.8972

$2.8738

-2.54%

9.02%
(per gallon)











Brent crude 

$112.01

$110.04

-2.23%

4.31%
(per barrel)











Retail gasoline

$3.7950

$3.8050

-0.89%

15.84%
(per gallon; AAA)












More spending cuts for Spain
The Spanish government proposed significant spending cuts that would trim budgets for each of its ministries by an average 8.9%. The overall effect would be to trim Spain's budget deficit to 4.5% of gross domestic product, down from 9% in 2011, The Wall Street Journal said.

Not only would the central government's spending be controlled, the government is proposing to control provincial spending more tightly as well. The moves would be made so Spain can apply for and win a financial bailout from the European Union, the European Central Bank and the International Monetary Fund.

The budget announcement came after several days of protests that were often violent. While bond investors were cheered, it's not clear the Spanish people are. The country already has Europe's highest unemployment rate, and it will probably go higher.

Tempur-Pedic will buy Sealy
The day featured a deal: Tempur-Pedic International (TPX) has agreed to acquire mattress company Sealy (ZZ) in a deal valued at $229 million. Sealy shareholders will receive $2.20 a share, a premium of 2.8% to Wednesday's close. Including debt assumption, the deal is valued at about $1.3 billion.

Wall Street likes the move. Tempur-Pedic was up $3.86 to $30.64. Sealy added 5 cents to $2.19.

A bias to the upside
Twenty-four of the 30 Dow stocks were higher, led by General Electric (GE), Intel (INTC) and Bank of America (BAC). Wal-Mart Stores (WMT) and AT&T (T) were the laggards.

Meanwhile, 408 S&P 500 stocks were higher. First Solar (FSLR), Discover Financial Services (DFS) and MetroPCS Communications (PCS) were the leaders. Printer R.R. Donnelly (RRD) and spice-maker McCormick & Co. (MKC) were the laggards.

Ninety Nasdaq-100 stocks were higher, led by Green Mountain Coffee Roasters (GMCR) and Avago Technologies (AVGO). Game-maker Activision Blizzard (ATVI) and Costco Wholesale (COST) were the laggards.

Jobless claims falls; drought hits GDP
The jobless-claims report was the day's cheery news. Claims fell 26,000 to a seasonally adjusted 359,000, the lowest level since mid-July. The four-week moving average dropped to 374,000 from 378,500. The moving average smooths out week-to-week changes.

At the same time, the Labor Department now reckons the American economy created 386,000 more jobs -- or 0.3% -- in the 12 months to March than previously thought. White House economic adviser Alan Krueger said the revision indicated that the United States had added nearly 5.1 million private-sector jobs, on a net basis, over the past 30 months.

The new estimate is something the Labor Department does annually. The revision has averaged 0.3% since 2000, according to the Liscio Report, which tracks government spending patterns.

Meanwhile, the final read on second-quarter gross domestic product showed growth of 1.3%, weaker than an expected 1.7%. Analysts said the impact of the drought was the biggest factor in the downward revision.

At the same time, August durable-goods orders tumbled 13.2%, much more than the 5% drop expected. A decline in orders at Boeing (BA) were the big driver for the decline, but other sectors showed weakness as well.

Short hits from the markets -- New York close



Thur.

Wed.

Month chg.

YTD chg.
Treasury yields











13-week Treasury bill

0.0900%

0.100%

0.00%

800.00%
5-year Treasury note 

0.638%

0.612%

7.05%

-23.13%
10-year Treasury note

1.640%

1.618%

4.99%

-12.35%
30-year Treasury bond

3.032%

3.032%

12.97%

4.95%
Currencies











U.S. Dollar Index

79.592

79.948

-2.00%

-1.15%
British pound

1.6239

1.6176

2.21%

4.51%
(in U.S. $)

 








U.S. $ in pounds

£0.616

£0.618

-2.16%

-4.32%
Euro in dollars

$1.29

$1.29

2.54%

-0.31%
(in U.S. $)

 








U.S. $ in euros

€ 0.774

€ 0.777

-2.48%

0.31%
U.S. $ in yen 

77.76

77.74

-0.93%

0.86%
U.S. $ in Chinese

6.32

6.30

-0.63%

-0.03%
yuan











Canada dollar

$1.020

$1.016

0.57%

3.98%
(in U.S. $)

 








U.S. dollar 

$0.981

$0.984

-0.57%

-3.83%
(in Canadian $)

 








Commodities

 

 

 

 
Gold (-GC)

$1,780.50

$1,753.60

5.50%

13.64%
(per troy ounce)

 








Copper (-HG)

$3.744

$3.710

8.30%

8.96%
(per pound)

 








Silver (-SI)

$34.6660

$33.9400

10.25%

24.18%
(per troy ounce)

 








Wheat (-ZW)

$8.5550

$8.6925

-3.82%

31.06%
(per bushel)

 








Corn (-ZC)

$7.1625

$7.248

-10.44%

10.79%
(per bushel)

 








Cotton 

$0.7153

0.7102

-7.42%

-21.98%
(per pound)

 








Coffee

$1.7430

1.6945

5.80%

-24.10%
(per pound)

 








Crude oil (-CL)

$91.85

$89.98

-4.79%

-7.06%
(per barrel)










 

473Comments
Sep 27, 2012 2:11PM
avatar
"Those who don't have any skin in the game or are on the dole  will vote for the current clown"

Every American has "skin" in the game. What many don't have is a death wish and part or all of their retirement in a fake rigged stock market. Yes, people with commonsense will vote for Obama. Those who can't think for themselves or form an opinion independent of coaching and propaganda will vote for Romney. More weeks still for the mesmerized to come to their senses.
Sep 27, 2012 2:11PM
avatar
"Drought hits GDP"

"Movie causes unrest"

"Bush is still causing unemployment and record deficits"

Really???
Sep 27, 2012 2:10PM
avatar
oh goodie, more low paying jobs. Let's bring in more illegals to fill them. 
Sep 27, 2012 2:09PM
avatar

"Those who don't have any skin in the game or are on the dole will vote for the current clown. Four more years of this idiot will be a disaster for this 'country'."

 

 

please change country to  Wall Street Barons.

Sep 27, 2012 2:07PM
avatar
I suppose Obamas responsible for the drought too, right? He caused it to stop raining in the midwest, right? I suppose it's his fault that big corporations don't pay a decent wage, right? It's his fault they don't provide benefits, right? I suppose it's his fault that economic deregulation led us to a depression, right? I suppose it's his fault that the Republican and Tea party say no to everything, even when they agree it would be a good thing for our country, and even if they co-write it?!! No. It isn't. Are the gains we've made enough, no. Are things better than they were, yes. Could your party and corporations they helped, that shipped all those jobs overseas pay a decent wage here and build here? Yes. Put the blame where it lies. It's not with President Obama. Your party has made his four years an uphill climb, every step of the way. Your childish remarks reek of Fox, Rush and hate radio. You are right about one thing, respect is earned, try earning it with your raving posts sometime.
Sep 27, 2012 2:06PM
avatar
Today's Lie: "Improved jobs picture". What a crock. This would be Ben Bernanke propping his banks up because they are dead in the water without him. Poor Ben... without him, banks would end. Instead he pretends to lend them what he can, what he really doesn't understand- is, that while he props what's dead, the nation decays and on our heads he does tread. End the Federal Reserve, before it ends us.
Sep 27, 2012 2:05PM
avatar
UREKA!!!!! First time jobless claims hit a 2 month low!!!!!

Nobody left to lay off!!!!!!!!!!!!!!

Life is good!!!!!!!!!!!!

This message approved by Harry Rodent........ I mean Reed.
Sep 27, 2012 2:04PM
avatar
The economy is improving.  It may be slow, but it is improving.  For all you Mitt Ryan disciples,if he is elected and pass his proposed budget, we instantly will be 5 Trillion dollars deeper in debt. It is a lot easier staying out of debt than it is getting out of debt.  Just remember who got us into this mess-that idiot GB.
Sep 27, 2012 2:02PM
avatar
money is a human invention that enables a few to gain great advantage over the many.
Sep 27, 2012 2:00PM
avatar
Any department under this regime will lie.  That's what we have all grown to love about them!
Sep 27, 2012 1:59PM
avatar
It's fantastic! Some of us can now get a 2nd or 3rd Job for XMAS!!!
Yay!!! 

We now have hope for more change in out pockets. Yay!!!

I'll just sell some more gold here instead...
Sep 27, 2012 1:54PM
avatar
The greed of our leaders in industry an washington is leading to our end of our way of life ! Or we will ,or are the new third world asking for aide for help ! Wake up! 
Sep 27, 2012 1:52PM
avatar
This is bogus at best.  These jobs are temporary, Christmas help, minimum wage jobs and will do nothing to boost the economy.  All it is doing is taking people off of the "actively looking for work" list and moving them over to the "now completely impoverished list."  I live in the Bay Area and there are no jobs here except Christmas help and a few tech jobs. 
Sep 27, 2012 1:51PM
avatar

What happened to housing, so far this week it had two days of making a comeback. I know yesterday it was going down again. I guess if you consider housing a non-durable good, you can make day to day assumptions.

 

Oops! I didn't realize the jobs comeback is today's item or was it China? Anyway, I knew they needed something today. My only complain, can't they get creative, they keep rotating the same things over and over like Europe, Greece, Spain, China, housing, jobs, Ben, QE1, QE2, QE3, etc., etc. But after all is said and done the GDP is 1.3% , my CD might out perform the GDP soon. 

Sep 27, 2012 1:51PM
avatar
Aww the sweet smell of tax payer dollars in the afternoon....
Sep 27, 2012 1:48PM
avatar
There are going to be alot of unhappy people here when Obama wins by 5 points.......
Sep 27, 2012 1:47PM
avatar

You idiot liberals don't know how to put two and two together.

 

Jobs up --  Middleclass income shrinking = Crap jobs

 

What part of this is so hard for you to understand......... you just don't want to because of your god Obama.

Sep 27, 2012 1:43PM
avatar
Can you say Bull $hit?   Yes we can
Sep 27, 2012 1:39PM
avatar

Holiday job hiring is estimated to be up over last years holiday hiring, which was a three year high.

 

This is good news no matter how you whacks want to spin it.

Sep 27, 2012 1:39PM
avatar
Yay! a 2 month low in layoffs...

Expecting that fake under 8% number tomorrow...
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