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first rise of ’05

NEW YORK » Wall Street had a mild rebound after three straight losing sessions yesterday, with investors sending stocks mostly higher despite a sharp rise in unemployment claims and mixed holiday retail sales. Only the Nasdaq composite index posted a small loss.

Although stocks fluctuated, Wall Street greeted the Labor Department's weekly first-time jobless claims report with surprising calm. Jobless claims rose to 364,000 last week, up from 321,000 the week before -- the sharpest rise in nearly three years.

Whether yesterday's gains can set a new direction for short-term trading remains to be seen, as the Labor Department today was expected to release its monthly job creation report, a key barometer of the labor market and the nation's economic health. A lower-than-expected number following November's lackluster job growth could send stocks lower.

And combined with another rise in oil prices and news this week that the Federal Reserve sees the potential for worsening inflation, and, in turn, higher interest rates, investors had reason to be nervous.

The Dow Jones industrial average rose 25.05, or 0.24 percent, to 10,622.88.

Broader stock indicators were mixed. The Standard & Poor's 500 index was up 4.15, or 0.35 percent, at 1,187.89, and the Nasdaq fell 1.24, or 0.06 percent, to 2,090.00.

Crude oil futures rose sharply, surging past the $45-per-barrel mark, one day after the Energy Department reported strong inventories of distillate fuels but a decline in crude reserves. A barrel of light crude was quoted at $45.56, up $2.17, on the New York Mercantile Exchange.

Investors kept a close eye on the retail sector as companies issued their sales reports from a mediocre holiday season. Dow component Wal-Mart Stores Inc. was up 76 cents at $54.05 after it confirmed that same-store sales -- sales from stores open at least a year -- rose 3 percent from a year ago.

Federated Department Stores Inc. saw same-store sales rise 2.3 percent in December, while rival J.C. Penney & Co. said its sales fell 1.2 percent, less than Wall Street had forecast. Federated slipped 2 cents to $57.20, while J.C. Penney fell 2 cents to $40.78.

Three retailers reduced their fourth-quarter profit forecasts after seeing sales slump over the holidays. Home decor outlet Pier 1 Imports Inc. fell 39 cents to $18.36, teen accessory retailer Claire's Stores Inc. lost 57 cents to $20.10, and Lane Bryant and Fashion Bug parent Charming Shoppes Inc. skidded 94 cents to $8.30.

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by Financials.com

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