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NEW YORK >> Wall Street plodded through another quiet preholiday session yesterday, finishing with moderate gains after a last-hour surge of buying.
Despite two upbeat economic reports, prices fluctuated in a narrow range for most of the session. Analysts attributed the market's tentativeness to concerns that an improving business climate has already been factored into Wall Street's higher prices.
"The market is the greatest forecasting tool out there. Stocks have been forecasting these (economic) results," said Gary Kaltbaum, market technician for Investors' Edge Partner, a money management firm in Orlando, Fla.
Trading was again affected by low volume, the result of many traders and investors being away on vacation.
"This week (before Labor Day) usually is just dismally slow. Trying to make something exciting about this week is tough," said Thomas F. Lydon Jr., president of Global Trends Investments in Newport Beach, Calif.
Yesterday's biggest winner was the Nasdaq composite index, which closed up 18.05, or 1 percent, at 1,800.18.
The Dow Jones industrial average advanced 40.42, or 0.4 percent, to 9,374.21. The Standard & Poor's 500 index rose 6.05, or 0.6 percent, to 1,002.84.
Advancing issues outnumbered decliners slightly more than 9 to 5 on the New York Stock Exchange. Trading volume was light at 1.15 billion shares, but up from 1.06 billion on Wednesday.
The Russell 2000 index, the barometer of smaller company stocks, rose 4.89, or 1 percent, to 495.81. The NYSE composite index gained 33.42 to 5,639.15. The American Stock Exchange composite index advanced 3.12 to 974.40.
Despite a slow week and erratic trading, Yesterday's gains were the third in a row for the Nasdaq and S&P, something that analysts found encouraging -- especially where the Nasdaq is concerned. When traders return from vacation, analysts said the market could have greater momentum.
"The Nasdaq keeps prodding along, and that is one thing that is going to be on the radar screens of most investors. As they come back from a long weekend and get re-engaged with their portfolios, they will realize the Nasdaq is at 16-month highs," Lydon said.
The Commerce Department reported that the economy grew at a 3.1 percent annual rate in the second quarter, stronger than previous estimates. The revised reading on gross domestic product showed the economy picking up at a faster speed than the 2.4 percent growth rate the department projected a month ago.
In a second report, the Labor Department said new claims for jobless benefits rose by a seasonally adjusted 3,000 to 394,000 last week. The fact that claims remained below 400,000, a level associated with a weak job market, offered hope that the pace of layoffs is stabilizing.
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