Dow up 151, takes back Tuesday loss

A bullish report on jobless claims raises hopes the recovery is getting stronger. Amazon.com and Tiffany shares fuel the rally. Markets close Thursday for Thanksgiving.

By Charley Blaine Nov 24, 2010 2:58PM

Charley BlaineUpdated: 6:15 p.m. ET

The stock market gave investors something to be thankful for: a rally so strong that the market made up all of Tuesday's losses.

The biggest catalyst to be thankful for: a larger-than-expected decline in the weekly report on initial jobless claims to the lowest level since the summer of 2008, before the Lehman Bros. collapse.

There were two other catalysts that have helped markets today: no shooting in Korea and less of a panic in Europe.

Result: The Dow Jones industrials ($INDU) closed up 151 points, or 1.4%, to 11,187. The Standard & Poor's 500 Index ($INX) rose 18 points, or 1.5%, to 1,198, and the Nasdaq Composite Index ($COMPX) jumped a robust 48 points, or 1.9%, to 2,543.

Markets will be closed Thursday for Thanksgiving and will be open until 1 p.m. ET on Friday.

The major indexes regained all of Tuesday's drubbing that saw the Dow drop 142 points. The rally trimmed losses so far this week to 16 points for the Dow and 1 point for the S&P 500. The Nasdaq is up 25 points on the week.


Crude oil moved higher on the jobless report, settling up $2.26 to $83.51 a barrel in New York. Crude is up 2.3% for the week.

 

The Dow is up 7.3% this year, with the S&P 500 up 7.5% and the Nasdaq up 12.1%.


Motorists should see stable, if high, gasoline prices for the holiday. AAA's Daily Fuel Gauge Report said the national average for regular unleaded gasoline was $2.869 a gallon, down slightly from Tuesday and down 0.5% so far this week. For the year, however, the price is up 8.7%.


Gold settled down $4.60 to $1,373, as the Korean tensions seemed to be tamed. Gold is still up 1.5% this week.

Interest rates were higher as investors and traders who bought Treasurys on Tuesday because of Korea sold them today. The good jobs report helped push rates higher. The 10-year Treasury yield was 2.903%, up from 2.762% on Tuesday. 


The big drop in jobless claims
The jobless-claims decline was larger than expected. The Labor Department said claims fell to a seasonally adjusted 407,000, down from 441,000 the week before.


The decline is part of a trend that's seen claims dip just about every week from a high of 504,000 in mid-August. It's also off from a seasonally adjusted peak of 651,000 in March 2009.


It was the lowest level for the widely watched statistic since the week that ended July 19, 2008.

"There’s economic momentum in the U.S.," David Kelly, chief market strategist for JPMorgan Funds in New York, told Bloomberg News. "The jobs market is finally beginning to respond to the economic recovery."

The report led to be sizable gains for temporary-help companies. Manpower (MAN) added 3% to $57.42. On Assignment (ASGN) jumped 10% to $7.14.  Monster Worldwide (MWW) was up 9.6% to $22.36 and was the S&P 500's top performer today.

While the jobs picture is starting to show improvement, Americans increased spending for the fifth straight month in October, the government said today. Household purchases advanced 0.4% after a 0.3% gain in September that was larger than previously estimated. Incomes climbed 0.5%.


Yes, the news was chipper, but UBS Financial Services' Art Cashin noted that the  jobless claims report normally comes out on Thursday. So, he told CNBC today, this week's data could skewed. Watch the revisions for the next few weeks.

Energy prices -- New York close
 

Wed.

Tues.

Month chg.

YTD chg.
Crude oil 

$83.86

$81.25

2.98%

5.67%
(per barrel)











Heating oil

$2.3255

$2.2496

3.92%

9.92%
(per gallon)











Natural gas 

$4.2670

$4.2640

5.67%

-23.42%
(per mil. BTU)











Unleaded gasoline

$2.2136

$2.1342

7.49%

7.83%
(per gallon)











Retail gasoline

$2.8690

$2.8700

2.14%

8.72%
(per gallon; AAA)












Consumer stocks get a lift
The spending report suggested growing confidence among consumers. It was one reason why shares of Tiffany (TIF) and Amazon.com (AMZN) were both higher today. Tiffany was up 5.3% to $61.33. Amazon.com added 5.4% to $177.25.

Twenty-eight of the 30 Dow stocks were higher, led by Boeing (BA) and Caterpillar (CAT), along with 98 of the 100 stocks in the Nasdaq-100 Index ($NDX.X), which tracks the largest Nasdaq stocks. The index was up 44 points, or 2.1% to 2,161. Amazon.com's performance was tops among Nasdaq-100 stocks and added 3 points to the day's gain.

Apple (AAPL), up 2% to $314.80, contributed 9 points to the index.

Stocks with sizable moves
Among the companies seeing larger-than-usual price changes:

  • Deere (DE), down 0.1% to $76.23. The largest maker of farm machinery reported a stronger-than-expected quarterly profit, thanks to strong sales in North America and market share gains in Brazil. The company is starting to see a European turnaround, but the company offered a cautious preliminary forecast for 2011 that fell short of expectations.
  • Synopsys (SNPS), up 2.5% to $25.71. The semiconductor designer was raised to "overweight" from "neutral" in a report by JPMorgan Chase analyst Sterling Auty. Auty said the company's cash flow may increase more than 30% in 2010 and 16% in 2011.
  • Oracle (ORCL), up 2% to $27.74. A federal jury in California said SAP (SAP), the world's largest maker of business application software, must pay $1.3 billion to Oracle for copyright infringement by a now-defunct software maintenance subsidiary. SAP was off 1.1% to $48.15.
  • Dynegy (DYN), up 2.6% to $5.13. The power producer may get a buyout offer of more than $6 a share from Seneca Capital and another investor, The Wall Street Journal reported today.
  • Guess? (GES), up 10.5% to $50.12. The clothing designer and retailer raised its 2011 earnings forecast to at least $3.02 per share, higher than the average analyst estimate of $2.93.
Two downsides: Durable goods and new-home sales
Bookings for durable goods excluding transportation equipment decreased 2.7% in October. Analysts had expected a gain of perhaps 0.5%.

Orders for non-defense capital goods excluding aircraft, considered a proxy for future business investment, fell 4.5% after a 1.9% gain in September. The government had previously estimated such orders dropped 0.2% in September.

The swings in orders for capital goods may reflect calendar effects that the government isn't able to capture with its seasonal adjustments, economists said.

New-home sales were down 8.1% in October to a seasonally adjusted rate of 283,000. The September level was 308,000. The media price fell 14% to $194,900. The inventory grew to an 8.6-months supply, up from as little as 5.3 months in April.

The report, to Capital Research, "is very worrying. Unlike existing sales, new sales should not have been directly affected by last month's freezing of foreclosure activity. But it appears that it may have had an indirect effect on confidence."

Sales were only 3% above August's record low and were nearly 30% below the levels of a year ago.

Nonetheless, homebuilder shares were higher, with Pulte Homes (PHM) up 2.4% to $6.42. The Philadelphia Housing Sector Index ($HGX) added 1.9% to 97.

Short hits from the markets -- New York close
 
  Wed.

Tues.

Month chg.

YTD chg.
Treasury yields




 





13-week Treasury bill

0.15%

0.14%

25.00%

200.00%
5-year Treasury note 

1.56%

1.39%

32.15%

-42.00%
10-year Treasury note

2.91%

2.76%

11.56%

-24.17%
30-year Treasury bond

4.30%

4.17%

7.40%

-7.43%
Currencies











U.S. Dollar Index

79.939

79.762

3.20%

2.20%
British pound

$1.5798

$1.5788

-1.60%

-2.34%
(in U.S. $)











U.S. $ in pounds

£0.63

£0.63

1.62%

2.39%
Euro in dollars

$1.34

$1.34

-4.01%

-6.49%
(in U.S. $)











U.S. $ in euros

€ 0.75

€ 0.75

4.17%

6.94%
U.S. $ in yen 

83.54

83.11

3.26%

-10.17%
U.S. $ in Chinese

6.68

6.64

-0.22%

-2.14%
yuan











Canada dollar

$0.99

$0.98

0.72%

4.09%
(in U.S. $)











U.S. dollar 

$1.01

$1.02

-0.72%

-3.93%
(in Canadian $)











Commodities

 

 

 

 
Gold

$1,373.00

$1,377.60

1.13%

25.25%
(per troy ounce)











Copper

$3.76

$3.70

0.59%

12.22%
(per pound)











Silver

$27.53

$27.57

12.07%

63.42%
(per troy ounce)











Wheat 

$6.48

$6.42

-9.72%

19.58%
(per bushel)











Corn

$5.39

$5.29

-7.43%

29.98%
(per bushel)











Crude oil 

$83.86

$81.25

2.98%

5.67%
(per barrel)












25Comments
Nov 24, 2010 5:28PM
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Seasonal jobs ARE JOBS!  Those that are presently without permanent jobs, any job or trying to make ends meet with additional income will be thankful for the work.  Additional jobs (however seasonal) mean additional spending and economic activity.  Seasonal jobs also provide the opportunity for the worker to showcase their talents to their temporary (seasonal)employer and perhaps have their employment become permanent.  Seasonal jobs ARE IMPORTANT!  Happy Thanksgiving!  
Nov 24, 2010 6:18PM
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Surprised  these posts are rife with misunderstandings about taxes, economics and capitalism.

 

1.  in a CAPITALISTIC economy, PEOPLE are responsible for getting jobs, retraining, re-locating (north dakota), entrepreneurship, and hustling, NOT the government.

 

2.  taxes need not be "RAISED" they simply need to return to the pre-reagan/bush years of NORMAL tax rates.  this worked well under clinton, and the steep corporate tax cuts in ireland have led to their downfall. the effect is to reduce the national debt, which lowers interest rates naturally, which increases credit to small businesses and consumers and creates JOBS.

 

3.  obama/schmama/yomama, the current conditions are a result of going into debt as an entire country over the past 30 years and creating standards of living way out of reality. time to adjust to the NEW NORMAL and learn to live with less, move in with another family, rent, take public transport, walk, ride a bike, eat beans and rice, make home-brew beer, just like the middle class in the REST OF THE WORLD.  there is nothing that makes us "special" now that we cannot pile on more debt.  adjust.  stop voting for campaign promises like the recent pinky-swear with America.

 

4.  YES, we should EXTEND UNEMPLOYMENT BENEFITS as long as we are in an economy with an unemployment rate above long-term averages.  these payments are immediately spent, allow people to have clothes/gas/nutrition to go out and look for work, and, MOST IMPORTANTLY these payments create a HUGE VALUABLE RIPPLE EFFECT across the national and global economies that stimulates growth and leads us out of this downturn.

 

wake up America!    Coffee cup   

 

Nov 24, 2010 5:36PM
avatar

People either need sustainable Jobs with sustainable incomes, or the Government needs to do something about Unemployment.

 

If they have to raise taxes on the wealthy to punish them for not hiring enough people, then so be it!

 

But people can't keep living this way and trying to survive on less than $100 a Week.  And those with mortgages and bills need alot more hope than what came of Obama's Failed Stimulus Bill that has only created a measly 3-4 Million Jobs.  There are still 25 Million Unemployed, and Under Employed Americans who need jobs.  The best way to make the Jobless Numbers look good, is to simply deny the Unemployed Unemployment Insurance. Good for the Stock Market and Wall Street,  But this isn't helping those who are Needing Incomes to survive on!!

 

The Cold Harsh Reality is that after Christmas, many of the Holiday Jobs Disappear as companies LAY People Off!

Nov 24, 2010 5:29PM
avatar

Neither Democrats or Republicans who are making RICH incomes, seem to give any care about the Unemployed!   Last year for a few months people managed to be able to collect. 

 

If you Only have a Part-time Job though and you become no longer able to collect Emergency Unemployment, then you are lucky if you can survive on $81 a WEEK!

 

Something has got to GIVE!  People can't be abandoned to this Horrible Economy.

Nov 24, 2010 4:46PM
avatar

Unemployment claims are down only because of seasonal jobs for the holidays.  This happens every year.   But unemployment will take a big jump up again after the holiday spending frenzy is over.

Nov 24, 2010 5:24PM
avatar

There are alot of people who are going without this Christmas. Alot of it is because people don't have Jobs, and alot of it is due to the People in our Government who refuse to help the Unemployed.

 

While the Republicans may want to extend Bush Tax Cuts for the Wealthy, the Unemployed are being denied Jobs and Incomes to survive on.  So as Unemployment runs out this November 30th and people suddenly don't have Cash to pay for Christmas, it will hit the economy something fierce!

 

Remember 14+ Million People are Unemployed, not counting the 10 Million Under Employed who can only find Part-time work.   When these people run out of cash to survive on, then chaos is inevitable!

Nov 26, 2010 3:12PM
avatar

When the double dip comes will depend on how long it takes for corporate america to run out of money again. If the fool alot of people intoo buying alot of terribly designed chevy volts it could take 4 years .Becuase that how long it will take the people that bought them to realize the should have bought a honda. However if amrica isnt foooled by there multi million dollar advertisement campian and no one buy it. it want take the auto workers union long to suck gm dry and there will come your double dip.

Nov 26, 2010 3:05PM
avatar
The best way to get rid of the currupt politician is not the buy what there selling. Right now there selling chevrolets, cadillacs and buicks. and chinese manufactured crap. They understand that they have to make policy to protect the voting block that elected them. So buying these things translates into supporting a currupt goverment. And i dotn just mean obama. is the republican also. They fight one another so they dont hae to worry about fighting anyone else
Nov 26, 2010 2:58PM
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9.5% is the number of people drawing unemployment not the number of unemployed. Thst number is pretty close to 18% and has not gone down in over 2 years. They can tell you aything they want about why its going down. Truth is it goes down about a tenth of a percent every 2 months becuase there are now more poeple loosing there benefits every month then there are initial claims. At this rate we will be down to about 8 % by the time obama is up for reelection and he wil say look everyone I have reducued unemployment by 3 percent in 4 years. At at that time 1 in 5 will have no job. The only reason the government didint do anything to manipulate that figure inthe lastcouple of years is becuase  the Auto Workers Union made up a huge chunk of the unemployed and they represent a huge block of people that are required to vote to be in that union. Now that they are back to work threw the 40 billion that gm got from the government and off the stock market. They people unemployed now have no voice becuase they dont vote and there for the government can now fix the numbers in there favor becuase there isnt a voting block in the ranks of the unemployed. Our government is the most currupt in the world and this is just one example.
Nov 25, 2010 8:48PM
avatar

The unemployment numbers are false.  They are just being cooked by the government to look better than they are.  They will be revised and nobody will report the revision.  Fly by media at its best. 

 

Any ideas on how soon until the double dip?

Nov 25, 2010 12:33PM
avatar
one sneeze that's what was required for that t or m to be a b  again......not to worry folk's some one have a horrific family squabble at thanks giving and take revenge on the market! M M M M mmmmmmm  goodMartini glassHotMartini glass
Nov 25, 2010 2:46AM
avatar
The greenbacks should now be printed with a new color that resembles their new value. We'll call them the brownbacks! Tongue out
Nov 24, 2010 10:05PM
avatar

Cool !!!

It always is such a problem to convert dollars to roubles to go to Russia. Then to convert roubles back into dollars, then from dollars into yuan to go to China.

Heck now instead of going back and forth from dollars. I can do a three way. Dollars to Yuan to Roubles to Dollars. Wheee!!!

Nov 24, 2010 8:03PM
avatar
Dow up 151 points! Thumbs down I'm sick to my stomach! Sick I'll just hope for a better day with major stock market losses on Friday. Happy choke on your turkey day to you too! Party
Nov 24, 2010 7:56PM
avatar

Hi!... Tom Delay here just wishing everyone a Merry Christmas! What? I did no such thing! I broke no laws! I'm innocent of all charges! I'm a proud American and a proud Republican, the Party that can do no wrong because we always say "NO" to everything,... except for our pay raises and enriching ourselves and our rich friends even more that is,... and there's nothing wrong with that,... it's American Capitalism at it's finest and it's all "legal".  I have been set-up and thrown under the bus and it's all the Democrats fault. It's a conspiracy I tell you! I'm a good man, just ask my family members and close "special interest" friends. Angel I approve this message!

Nov 24, 2010 7:35PM
avatar

Preach it A-RIA.!!!

Anyone looking for work, look at HLF. They have been growing like a weed.

Course that's only for people that want to make more money this year then they did last year.

Most people just want a paycheck, not income.

Nov 24, 2010 6:26PM
avatar

Thumbs up  excellent point twobe, all of this done in the name of "productivity" as juiced by government regulations.  the is a main reason why the tea party swept into national politics so quickly.

 

end the OVERREGULATION on SMALL BUSINESS NOW!!!

 

unfortunately, we are going to have to physically pull these career, insulated, fat, over-comfortable, incestuous, over-paid, over-pensioned government bureaucrats out of their jobs from local to national.  the push has begun.  they need to be shown the door so they can learn what it takes to actually earn a dollar instead of taking a dollar!

Nov 24, 2010 6:14PM
avatar

one problem I personnelly know about concerning unemployment is a tax benefit my company gets for having less than 25 employees.  We won't hire above that rate 1 or 2 workers because we loose tax breaks.  Its very difficult for those 2 workers to make enough in profits to offset the benefit. I am working 4-8 hours overtime every week the last two years. Multiply that by who knows how many companies and you have overworked people and out of work people.

Nov 24, 2010 5:18PM
avatar
tis a magical time of year. guess the folks were back at the white house
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