Stocks gain after unemployment claims fall

Published on NewsOK Modified: May 2, 2013 at 4:39 pm •  Published: May 2, 2013
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NEW YORK (AP) — The stock market is all about jobs this week.

Stocks rose Thursday after unemployment claims fell to a five-year low. A day earlier it was just the opposite; the market slumped after companies added just 119,000 jobs in April, the fewest in seven months, according to payroll processor ADP. And stocks could swing again Friday when the government's closely watched monthly employment report is released.

"Everyone is looking to the April jobs numbers," said Tyler Vernon, chief investment officer at Biltmore Capital. "People are more confident that it was an anomaly last month and are looking for some bigger numbers."

Economists forecast that the employers added 160,000 jobs last month. Stocks slumped April 5 when the government said 88,000 jobs were added, less than half the number forecast.

Signs of increased hiring have supported this year's surge in stocks and pushed the market to record highs. The run-up has started to falter in recent weeks on concerns that the global economy is slowing. More jobs should boost consumer spending, a key driver of U.S. growth.

The Dow Jones industrial average rose 130.63 points to 14,831.58 on Thursday, an increase of 0.9 percent. The index lost 138 points a day earlier. The Standard & Poor's 500 index climbed 14.89 points, or 0.9 percent, to 1,597.59, also recovering almost all of its losses from a day earlier.

Applications for unemployment benefits fell last week to 324,000, the fewest since January 2008, the Labor department reported before the market opened.

The outlook for global growth also got a boost after the European Central bank cuts its benchmark interest rate a quarter of a percentage point to 0.5 percent.

The euro fell a penny against the dollar to $1.3060. The price of gold rose $21.40, or 1.5 percent, to $1,467.60 an ounce. The price of crude oil rose $2.96, or 3.3 percent, to $93.99 a barrel.

Higher profits from CBS, Facebook and other companies also lifted stocks Thursday.

Broadcaster CBS reported a 22 percent jump in first-quarter earnings as big events like the Super Bowl pushed advertising revenue higher. Its stock rose 95 cents, or 2 percent, to $47.35.

GM rose 98 cents, or 3.2 percent, to $31.16 after it lost less money in Europe and beat Wall Street's expectations for first-quarter profit. The automaker's earnings of 67 cents a share beat the 54 cents predicted by Wall Street analysts who follow the company.

Facebook gained $1.54, or 5.6 percent, to $28.98 after its first-quarter revenue rose 38 percent, surpassing Wall Street expectations. Nearly a third of the company's advertising revenue came from mobile devices, a greater share than analysts had expected.

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