US stocks move sharply higher; Disney jumps
Encouraging news about the job market and strong earnings from Disney helped drive U.S. stocks sharply higher in afternoon trading Thursday. The market was rebounding a day after posting small losses.
KEEPING SCORE: The Dow Jones industrial average rose 156 points, or 1 percent, to 15,597 as of 12:13 p.m. Eastern time. The Standard & Poor’s 500 index added 18 points, or 1 percent, to 1,769. The Nasdaq composite gained 42 points, or 1.1 percent, to 4,053.
MOUSE HOUSE: The Walt Disney Co. reported better-than-anticipated fiscal first-quarter earnings late Wednesday. The media giant got a lift from its movie hit “Frozen” and sales of the “Disney Infinity” video game. The stock rose $3.57, or 5 percent, to $75.33.
SECTOR WATCH: The gains were broad. Nine of the S&P 500′s 10 sectors rose. Only telecommunications stocks fell.
“The fear in the markets has subsided some,” said Marc Doss, regional chief investment officer at Wells Fargo Private Bank.
FEWER UNEMPLOYMENT CLAIMS: The Labor Department said Thursday that the number of people applying for U.S. unemployment benefits declined 20,000 last week to 331,000. That suggests Americans are facing fewer layoffs and better job prospects. The less volatile four-week average ticked up 250 to 334,000. That remains near pre-recession levels and suggests job losses have waned.
EYES ON JOBS: Investors were looking ahead to a key jobs report due out Friday. They are waiting to see if the government’s January employment survey will show that hiring bounced back last month, following the addition of just 74,000 jobs in December. That was the fewest in three years and far below the average of 214,000 added in each of the previous four months. Stocks have fallen on recent signs of weaker growth in the United States, Europe and China. Turmoil in developing countries has also spooked investors.
BUMPY RIDE: Major indexes were gaining a little bit of the ground lost since Monday, but remained on track to close down for the week. The slide began when the Dow sank 326 points on Monday as disappointing news about U.S. manufacturing unnerved investors. By Thursday afternoon, the Dow was headed toward a decline of about 6 percent for this year. The S&P 500 was trending toward a decline of 4.3 percent.
TWEET THIS: Investors hammered Twitter’s stock on worries that growth is slowing at the online messaging service. Twitter reported stronger-than-expected fourth-quarter revenue and adjusted earnings late Wednesday, its first quarterly earnings report as a publicly traded company. But its user numbers signaled that growth is slowing. The stock lost $13.80, or 20.9 percent, to $52.17.
BONDS: The yield on the 10-year Treasury note ticked up to 2.71 percent from 2.67 percent on Wednesday. The yield, which affects rates on mortgages and other consumer loans, has been creeping higher since Monday, when it fell to 2.58 percent, the lowest in more than two months. Investors moved money into bonds in recent weeks on concern that U.S. growth is slowing.