By Donna Kardos Yesalavich
NEW YORK (MarketWatch) -- U.S. stocks rose Thursday, putting the
Dow Jones Industrial Average within reach of the key 11000 level as
better-than-expected employment and retail-sales numbers encouraged
investors ahead of quarterly earnings reports and monthly jobs
data.
The Dow (DJI) climbed 25 points, or 0.2%, to 10993. Alcoa (AA)
led the Dow's ascent with a 1.6% increase ahead of the aluminum
giant's third-quarter earnings report due after the close, marking
the start of the reporting season.
The Nasdaq Composite (RIXF) rose 0.4% to 2390. The Standard
& Poor's 500 index (SPX) added 0.3% to 1163. The financial and
technology sectors led the gains while consumer-discretionary
stocks were also strong.
Consumer stocks got a boost as retailers reporting their
same-store sales for September mostly topped expectations, with
American Eagle Outfitters (AEO), Abercrombie & Fitch (ANF) and
Limited Brands (LTD) among the standouts. In premarket trading,
American Eagle--which also boosted its fiscal third-quarter
earnings outlook--climbed 4.5%, while Abercrombie jumped 8.6% and
Limited added 3.3%.
Also lifting sentiment, the number of U.S. workers filing new
claims for jobless benefits unexpectedly fell last week to their
lowest level since July 10. The four-week moving average, which
aims to smooth volatility in the data, also declined.
The weekly numbers come a day before the Labor Department
releases its monthly jobs report for September. While economists
are expecting to see fewer payroll cuts than reported in August,
they still anticipate a decrease of 10,000 U.S. jobs and a slight
rise in unemployment.
Still, even if Friday's jobs report disappoints - as monthly
private-sector employment data did Wednesday - stocks could still
get a boost as weak numbers would raise expectations for the
Federal Reserve to hit the market with additional stimulus measures
more quickly.
The dollar was been on a decline recently as expectations have
increased for the Fed to make more moves to prop up the economy.
Meanwhile, investors have been piling into bonds, commodities and
stocks.
The U.S. Dollar Index (DXY), tracking the U.S. currency against
the dollar, continued its tumble with a 0.5% drop Thursday.
Treasurys rose, pushing the yield on the two-year note to a record
low of 0.359% while the yield on the 10-year (UST10Y) fell to
2.39%. Crude-oil futures advanced above $84 a barrel and gold
futures hit a fresh record.
The dollar's fall came as the euro climbed to $1.3999. European
Central Bank President Jean-Claude Trichet said the euro zone's
economic recovery should proceed at moderate speed, albeit with
risk and uncertainty "still prevailing."
Among stocks in focus, Marriott (MAR) dropped 4.5%. The hotelier
swung to a fiscal third-quarter profit on improved revenue as room
rates continued to rise, but revenue was slightly short of what
Wall Street expected and the company gave a cautious fourth-quarter
forecast.
PepsiCo (PEP) slipped 2.7%. The beverage and food giant reported
a 12% rise in fiscal third-quarter profit, but the company also
trimmed the top end of its 2010 earnings-growth forecast.