Stocks move up on light volume
NEW YORK » Stocks rose modestly for a second straight session yesterday as unemployment claims fell unexpectedly and consumer spending grew, if somewhat tepidly, without triggering inflation.
The Labor Department reported that first-time jobless claims fell to a better-than-expected 318,000 last week, down by 13,000 from the previous week. And while the Commerce Department reported a modest 0.3 percent rise in both personal income and consumer spending last month, the report also pointed to falling inflation risks.
Disappointing earnings from Micron Technology Inc. threatened to pressure technology stocks, which have been battered this month as investors moved to less risky, large-cap stocks. But other tech stocks made gains, led by strong earnings from Research In Motion Ltd.
However, light volume -- blamed in equal measure on the upcoming holidays and New York's transit strike -- meant little interest in bidding stocks substantially higher, analysts said.
"Right now, there's just a lack of solid trading volume out there, so we're struggling to move higher based on the good news we have," said Peter Cardillo, chief strategist and senior vice president at S.W. Bach & Co. "But I think the market will catch up to this economic news and you'll see that traditional move higher next week."
The Dow Jones industrial average rose 55.71, or 0.51 percent, to 10,889.44.
Broader stock indicators also were higher. The Standard & Poor's 500 index added 5.33, or 0.42 percent, to 1,268.12, and the Nasdaq composite index gained 14.83, or 0.66 percent, to 2,246.49.
Bonds moved sharply higher after two previous down sessions, with the yield on the 10-year Treasury note falling to 4.43 percent from 4.49 percent late Wednesday. The dollar was mixed against other major currencies, while gold prices moved higher.
Crude-oil futures for February delivery fell 28 cents to settle at $58.28 yesterday on the New York Mercantile Exchange.
Investors also were encouraged by the latest index of leading economic indicators from the Conference Board. The index rose 0.5 percent in November as unemployment claims dropped and energy prices eased.
Still, investors seemed uninterested in bidding stocks strongly higher. With energy prices still at historic highs for this time of year, and uncertainty over the Federal Reserve's interest rate policy once Chairman Alan Greenspan retires in late January, there's little impetus to make a major bet.