• Stronger economic reports push stock market higher
    By
     | August 30,2013
     
    AP Photo

    Trader Michael Hagis works on the floor of the New York Stock Exchange.

    NEW YORK — The stock market edged higher on Thursday as positive news for the U.S. economy outweighed worries about escalating tensions with Syria.

    The Dow Jones industrial average added 35 points, or 0.2 percent, to 14,858 in late afternoon trading, while the Standard & Poor’s 500 index was up six points, or 0.4 percent, at 1,641. The Nasdaq composite rose more sharply, gaining 32 points, or 0.9 percent, to 3,625.

    Verizon Communications was the biggest gainer among the blue chips after Britain’s Vodafone confirmed it was in talks with Verizon to sell its 45 percent stake their joint venture, Verizon Wireless.

    Verizon rose $1.47, or 3 percent, to $48.05. The U.S.-listed shares of Vodafone rose $2.39, or 8 percent, to $31.81.

    The stock market recovered much its loss from Tuesday, when the Dow fell 170 points as the U.S. denounced an alleged chemical weapons attack in Syria.

    While many fund managers said they’re not looking to jump back into the market just yet, some individual companies are looking attractive again.

    “If you’re a long-term investor, it’s an opportunity,” said Richard Sichel, chief investment officer at Philadelphia Trust Co., which has $1.9 billion under management. He noted a new investment, the retail chain PetSmart, as an example.

    Wayne Wilbanks, chief investment officer at the asset management firm Wilbanks, Smith & Thomas, said the market might have fallen too quickly. He also cautioned that the gains from the last two days may not last.

    “Be very careful,” Wilbanks said. “You haven’t missed out on much if you’ve sat on the sidelines since May. I’m not putting a lot of money to work here.”

    Traders focused on good economic reports that came out early Thursday. The U.S. economy grew at a 2.5 percent annual rate from April through June, much faster than previously estimated, the government said. The figure was revised up from 1.7 percent as more U.S. companies exported goods and imports declined.

    Also, the Labor Department said the number of people who filed for unemployment benefits last week fell to 331,000, the fewest in five years.

    While lower unemployment claims and an upward revision on GDP are both positive signs, most of Wall Street’s attention is focused on next week, when the August jobs report will be released. The Federal Reserve is expected to decide the fate of its massive bond-buying program in mid-September, and the jobs survey will be the last bit of significant economic data the Fed will have to consider before making its decision.

    Traders also continue to watch Syria, where a U.S.-led attack could happen, although such a strike seems less imminent than earlier in the week.

    “The general feeling is that Syrian tensions have eased a bit,” said Alec Young, global equity strategist with S&P Capital IQ.

    The price of crude oil fell $1.37, or 1 percent, to $108.71 a barrel. Oil had climbed as high as $112 earlier this week.

    Energy-related stocks fell. Exxon Mobil slipped 2 percent and Chevron fell 1 percent.

    Investors worry that a limited strike could drag the U.S. and its allies into that nation’s civil war, or worse, set off a regional conflict in an area where so much of the world’s oil is located.

    Beyond the news about Syria, it remains a mostly quiet week for stocks. Traders are winding down during the last week of summer and heading out for the Labor Day holiday this weekend.

    Midday trading volume on the New York Stock Exchange was roughly 1.3 billion shares, far below the roughly 3.4 billion shares typically traded daily.

    Wilbanks said he doesn’t expect the market to move substantially higher from these levels, citing the mediocre second-quarter earnings that U.S. companies just finished reporting.

    “We’re going to need to see robust corporate profit growth to move the market higher,” he said.

    In other corporate news, teen clothing store operator Guess jumped $3.48, or 12.7 percent, to $30.78 after the company reported second-quarter profit and revenue late Wednesday that blew past the expectations of Wall Street analysts. The retailer also raised its profit forecast for the year.

    Campbell Soup fell $1.17, or 2.6 percent, to $43.54 after posting a loss for its fiscal fourth quarter. The company’s results were dragged down by a charge related to the potential sale of a European business. While the results topped Wall Street’s estimates, revenue missed expectations.

    MORE IN Wire News
    WASHINGTON — President Barack Obama delayed acting on immigration and an attorney general... Full Story
    Obama switches gears, confronting Ebola head on
    BAGHDAD — Iraqi authorities have executed at least 60 people so far in 2014, a United Nations... Full Story
    More Articles
  •  
     
    • MEDIA GALLERY 
    • VIDEOS
    • PHOTOS