Wall Street: Thursday close

13 April 2012

STOCKS rose after a batch of encouraging economic data, including a report showing US gross domestic product grew at an unexpectedly brisk pace in the second quarter, lifted hopes the economy is gaining steam.

That optimism also helped the Nasdaq Composite Index round out July with its first six-month string of gains since 1995. The Dow Jones industrial average and the Standard & Poor's 500 Index racked up a fifth straight month of gains -- a streak unseen since 1998.

The US economy grew at an annualised rate of 2.4% in the second quarter, driven by a surge in military spending, the Commerce Department said. The reading easily beat Wall Street economists' forecasts for a rise of 1.5%.

In a separate report that cheered the market further, the weekly number of Americans filing new claims for jobless benefits fell unexpectedly to 388,000 last week from a revised 391,000 in the previous week.

The market ended well off its highs of the day, however, as investors locked in profits. The Dow rose 33.75 points, or 0.37% to 9,233.80, and the broader S&P 500 climbed 2.82 points, or 0.29% to 990.31. The technology-laced Nasdaq Composite rose 14.23 points, or 0.83% to 1,735.14, according to the latest data.

For July, the Dow climbed 2.8%, the S&P 500 rose 1.6%, and the Nasdaq Composite jumped 6.9%.

In earnings news, Procter & Gamble, the maker of 300 leading consumer products, said quarterly profit rose. New products, like an overnight tooth whitener, and the weak dollar helped lift P&G's revenues. The shares rose 12 cents to $87.87.

Exxon Mobil, the world's biggest publicly traded oil company, said its second-quarter profit rose sharply on higher oil and natural gas prices. Exxon stock gained 26 cents, or 0.74% to $35.58.

Tech stocks got a boost after brokerage Merrill Lynch said it was 'shifting stance on the semiconductor business from our neutral position to a more positive outlook.'

Merrill Lynch helped bolster the semiconductor sector after it raised its ratings on a number of companies in the sector, including National Semiconductor, which rose $1.59, or 8% to $22.35. The Philadelphia Stock Exchange semiconductor index rose 2.22%.

Halliburton, the world's second-largest oilfield service company, was another bright spot after it said it reversed last year's losses, overcoming charges for a troubled project in Brazil. Its stock rose $1.06, or 5% to $22.17.

But the bond market had stock investors on edge again. US Treasury prices crumbled and yields surged to one-year highs. The move fanned fears higher borrowing costs could deflate the housing market -- an area of strength in an otherwise soggy economy.

Weighing on the market was Cardinal Health, which tumbled after the drug wholesaler's 2004 earnings forecast disappointed Wall Street. Its shares fell $9.71, or 15% to $54.75.

Consumer products maker Newell Rubbermaid also took a hit after it said its profit fell 17% amid weaker retail orders and it cut its earnings forecast for the year. Its shares dropped $4.79, or 17% to $23.63.

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