Stocks rise on jobs, factory data

Jobless claims climb less than expected, and US factory orders fall less than forecast. The ECB holds rates steady as Draghi says the ECB is ready to buy bonds. Google warns of more cuts at Motorola. Facebook now has 1 billion active users.

By Melly Alazraki Oct 4, 2012 9:18AM
stock marketLast updated 12:01 p.m. ET

U.S. stocks mostly added to gains Thursday after jobless claims rose less than expected and factory orders fell less forecast. Adding to optimism was the European Central Bank President comments the bank is primed to buy bonds when necessary. Investors also await the minutes from last month's Federal Open Market Committee meeting. Tech, however, lagged the general rally as Hewlett-Packard, Facebook shares declined.

The Dow Jones Industrial Average ($INDU) was up 66 points at 13,561. The S&P 500 ($INX) was up 7 points at 1,458. The Nasdaq Composite ($COMPX) was up 1 point at 3,136.

Is Romney's strong performance driving futures higher?
Wall Street will also react to the first presidential debate Wednesday night, which ended with President Barack Obama and Republican candidate Mitt Romney discussing economic issues, including their views on Medicare, taxes, budget deficits and how to boost economic growth.

While nothing new was revealed in the debate, many pundits agree that Romney put on a strong performance. Some argue that this could have been driving stock futures higher.

In the end, it's all about jobs
The number of people who applied for U.S. unemployment benefits rose to a seasonally adjusted 367,000 last week, the Labor Department said Thursday. Economists had expected claims to rise to between 365,000 and 370,000, according to different estimates.

Initial claims from two weeks ago were revised up to 363,000 from an original reading of 359,000, based on more complete data collected at the state level.

The four-week average of new claims, considered a better gauge, as it smooths out volatility, was unchanged at 375,000. 

The number of planned layoffs at U.S. companies in September rose 4.9% after hitting a 20-month low in August, according to consultants Challenger, Gray & Christmas. Despite the relative increase, the latest reading marks a 15-year low in planned job cuts announced for the month of September.

On Wednesday, stronger-than-expected jobs figures and activity in the services sector helped offset weak data in Asia and Europe as the Dow industrials managed to climb 12.25 points to 13,494.61.

The different employment reports come ahead of Friday's all-important nonfarm payrolls data. Economists expect 120,000 jobs were created in September, according to, and the unemployment rate to remain steady at 8.1%.

Factory data and the Fed minutes

Orders placed with U.S. factories fell 5.2% in August -- the most since January 2009 a, signaling that slowdowns in business investment and exports restrained the economic expansion. Economists had predicted a fall of 6%, according to The Commerce Department also revised July's 2.8% increase down to 2.6%

Factories are feeling the effects of Europe's economic troubles and the slowdown in growth in China and other Asian markets. In addition, concerns about the U.S. fiscal cliff of tax increases and government spending cuts set for January also are putting the brakes on business investment, which has been a mainstay of the expansion, Bloomberg reported.

At 2 p.m. ET, the Fed will release the minutes from its latest policy meeting on Sept. 12 and 13, when the bank announced its third round of quantitative easing.

Asia reacts to debate, while Europe slightly higher on Draghi

Asia stocks closed mostly higher, led by Japan, as exporters got a boost from a weaker yen. Many analysts suggest Asian markets were reacting to advancing U.S. stock futures as Romney performed well in the debate.

Meanwhile, both the Bank of England and the European Central Bank left key rates unchanged. ECB President Mario Draghi said the bank is ready to start buying government bonds as soon as the necessary conditions are fulfilled by any countries needing assistance. This, he said, has already calmed financial markets.

Draghi said that European growth is expected to remain weak and recover gradually. Yet he repeated that the euro is irreversible and that risks are on the downside and should be contained by effective policy action.

Draghi added that while there's been significant progress in Spain, many challenges remain. Investors await to see when Spain will ask for aid, triggering the ECB's bond-buying plan. European markets were slightly higher Thursday.

Retailers report September sales

U.S. retailers will be in focus Thursday, with many reporting same-store sales for September. In general, September sales looked solid, not stellar, Reuters reported, after the back-to-school shopping season and ahead of the holiday season.

Already, Costco Wholesale (COST) reported a 6% gain for September same-store sales and an 8% rise for total sales. Target (TGT) reported a same-store-sales rise of 2.1% in September.

Gap's (GPS) September same-store sales increased by 6%, ahead of the estimate of 5.4% in a survey of analysts by Thomson Reuters. Macy's (M) reported same-store sales increased by 2.7%, below growth estimates of 3.3%. Kohl's (KSS) September sales fell 2.7%, while analysts expected a drop of just 0.2%.

Stocks to watch

Hewlett-Packard (HPQ) edged lower after falling 13% Wednesday on a disappointing 2013 earnings outlook.

Facebook (FB) shares rose as the social network reached a milestone of 1 billion active monthly users.

Google (GOOG) expects to expand job cuts at its Motorola Mobility unit beyond previously announced U.S. cuts. The company will take a $340 million third-quarter charge in severance and other costs.

Shares of NuVasive (NUVA) sank, continuing sharp losses from late Wednesday after the medical device company cut its quarterly sales outlook.

Applied Materials (AMAT) will take $180 million to $230 million in charges before taxes as it reduces its global headcount by 6% to 9% -- 900 to 1,300 positions. The cost savings will help the company fund its key growth initiatives.
Oct 4, 2012 11:41AM

El Retardo committed suicide last night when he found out Mitt was going to take him off the dole and give him a job!


Har har har!

Oct 4, 2012 11:38AM
Interest rates can´t be kept at zero for a long period of time without causing big damage to the economy. It´s a basic principle of economics that money has to be remunerated for time, otherwise saving loses any meaning. Bernie is what they call an "academic", but in reality he is just a mistaken one. Correlation between interest rates and growth is not linear.
Oct 4, 2012 11:38AM
 I remember a car ad where two young dudes take their 4x4 to the top of a mountain to dump gramp's ashes in his beloved wilderness. So much for leaving things for the next generation
Oct 4, 2012 11:33AM
Missing in Action today :

4 the Love of Other's Money
Re Togg
Gee, I wonder why ?

Oct 4, 2012 11:32AM
WASHINGTON (Reuters) - The number of Americans filing new claims for unemployment benefits rose only slightly last week after a big drop the week before, keeping in place a trend that suggested a mild improvement in the labor market.

Traders, please take notice!!!
Oct 4, 2012 11:32AM
Calling DO DO
Calling DO DO


Oct 4, 2012 11:31AM

I like it when the market goes up!


Imagine what it will be like with a president Romney? I expect a 1,000 point up week!


Har har har!

Oct 4, 2012 11:26AM
 Which side has the policies that will make my gold go up in value. That's who I want to vote for because, like you, I vote my pocketbook. And I simply don't believe you when you say inflation will negate any gold gains
Oct 4, 2012 11:26AM
If Romney wins, Bernie is gone. Then we see if interest rates will be at zero until 2015... Bernie must go!!!
Oct 4, 2012 11:26AM
I don't see any improvement in the economy for several of our small buisnesses, only for the big box stores that people choose to keep supporting! thanks America.
Oct 4, 2012 11:25AM

As strong as Romney looked last night I don't think we have yet to see his strongest quality.  He will bring; of course hoping and if he is elected,  many many very smart and dedicated business people into his administration and this will benefit all of us.  I believe only 8% of the present administrative slots have folks with any private sector experience. Not too much  difficulty understanding how this present clusteref of beaucrats have managed to creat so much chaos. But man the time and money wasted to prove to all of us they have no clue.  Very Very sad.

Oct 4, 2012 11:24AM

Is anyone else anticipating the VP debates as much as I am?


I predict the DOW up over 100 pts the next day.........


It should be a good laugh, Biden acting a fool and Ryan trying to take it easy on the mentally hadicapped old coot!

Oct 4, 2012 11:23AM
Jobless claims RISE!. less than expected. US factory orders also FALL! less than expected. 

Good news yay!

Maybe the debate is why we are up. no?
Oct 4, 2012 11:23AM
Market shoots up on HOPES of new administration.
Oct 4, 2012 11:22AM
Romney avoided the toughest questions: How to make his plan work without hurting the middle class.
Oct 4, 2012 11:21AM

ABS you clearly can't read. 

First I concede the point that Romney won the debate yet you still attack me.

2nd you call me a paid poster 24/7, first you will see I have not posted on  a weekend or in the evening even once.  You say what reason do I have to watch the debates?  How about the same reason millions of people around the world do, USA is still the largest economy and military and the direction it takes is important to everyone.  As a Canadian it is our largest trading partner and you know, next to us.  I have posted that multiple times so read it and understand it if you are capable.

Oct 4, 2012 11:19AM
As usual the millions of parasitic TV political analysts are picking over the bones of the debate, telling us who won, discussing in great detail the facial expressions of the two candidates. Why can't they just all shut up. They don't know any more than we do. In fact, our opinions are far superior if only because we're not rotten paid schills. 
Oct 4, 2012 11:19AM

Whack Job Wrote:

Romney destroyed Obama in the debate, and the markets are flourishing because of it!  Obama's house of cards is tumbling as we speak..........--------------------------------------------------------------


So let's see stocks have been hitting record highs sense President Obama was elected but today it's because of Romney.



Oct 4, 2012 11:18AM

The economic data that dribbles out each day most of the time is insignificant importance. Markets are mainly driven by emotions. When trader and investors (are there any left?) feel good, makets reflect it. Same thing when they feel bad.


I can predict the future too of the debates. Mitt will win them all. You know he'll be prepared with the data, facts, and detailed answers. Obama just doesn't have the intellect  to successfully debate Romney. All he has to fall back on is some canned flowerly crap probably about the repressed minorities!


Biden is a loud-mouth hot head, and I'm sure Paul will irritate the piss out of him. Joe will probably have a heart attack. Good!


Go Paul go, Biden blows!

Oct 4, 2012 11:18AM
It´s just the old same manipulation from a small group of crooks. Draghi wants to control the situation just by using words, Europe has no concrete solution for its crisis.
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