By Anora Mahmudova
NEW YORK (MarketWatch) -- U.S. stocks rallied on Thursday,
extending their record run after government data showed a decline
in weekly jobless claims.
The Dow Jones Industrial Average (DJI) surged 122.33 points, or
0.8%, to 16,479.88, marking its 50th record close this year. J.P.
Morgan Chase & Co. (JPM) was the only component in the 30-stock
index that ended in negative territory.
The S&P 500 index (SPX) added 8.70 points, or 0.5%, to
1,842.02, closing at a record level for the 44th time this
year.
The Nasdaq Composite (RIXF) closed 11.76 points, or 0.3%, higher
at 4,167.18.
The Labor Department said on Thursday that the number of
Americans claiming weekly unemployment benefits for the first time
dropped by 42,000 to 338,000. However, weekly claims tend to be
volatile and are distorted by seasonal changes. The four-week
average, which tries to smooth out volatility, rose 4,250 to
348,000. The overall trend indicates that jobless claims, a proxy
for layoffs, are low, and that workers are gaining confidence in
the labor market.
In the bond market, the 10-year Treasury yield hit 3% on
Thursday for the first time since September as rates moved higher
in the wake of the Federal Reserve decision to reduce its asset
purchases. Rising 10-year yields are seen as a sign of rising
interest rates.
The Dow and S&P 500 closed at record highs on Tuesday in a
holiday-shortened session and were closed on Wednesday for
Christmas. Historically, markets see abnormally high returns in the
trading days between Christmas and New Year's Day. Bill Stone,
chief investment strategist at PNC Asset Management Group, gave
three reasons for this: portfolio adjustments for maximizing tax
benefits before year end, investor optimism associated with the
holiday season or the fact that a large number of short sellers are
on vacation until the new year.
Shares of Urban Outfitters Inc. (URBN) rose 2.2%, making it one
of the best performers on the S&P 500.
Shares of Twitter Inc. (TWTR) continued their meteoric rise,
gaining 4.8% on Thursday, reaching their highest level ever. They
have risen more than 76% this month.
Among retailers, Fossil Group Inc. (FOSL) rose 1.3%, while Bed
Bath & Beyond Inc. (BBBY) gained 1.1%. However, eBay Inc.
(EBAY) shares fell 2%.
Tesla Motors Inc. (TSLA) shares rose 2.7%, extending a 5.5% gain
from Tuesday when the car maker's top safety rating was reaffirmed
by the National Highway Traffic Safety Administration.
BlackBerry Ltd. (RIMM) shares slid 8.8% after news that the
mobile phone maker's co-founder and co-chief executive officer Mike
Lazaridis had dropped a plan to buy the company.
In Japan, the Nikkei 225 index extended its six-year high,
pushing above 16,000 as the yen (USDJPY) weakened against the
dollar, but China's Shanghai Composite fell on disappointment over
a lack of additional cash injections from the central bank.
European markets were closed on Thursday.
Metals futures rose in thin, post-Christmas trade, with gold
futures adding 0.7% and silver futures jumping 2%. Oil futures also
finished higher.
More must-reads from MarketWatch:
Jobless claims fall 42,000, biggest drop in 13 months
Jeff Reeves confesses to his stupidest investment ideas of
2013
Best day to play, 'worst-Christmas-ever' stocks and Japan a
go-go
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