Encouraging economic news lifts US stock market


NEW YORK (AP) — Encouraging news about the economy lifted the stock market in late-morning trading Thursday.

Unemployment claims fell close to their lowest level in six years and new data showed that economic growth accelerated in the second quarter.

The positive reports were welcome news for investors worried about budget gridlock in Washington, which has led the Standard & Poor's 500 stock index to five straight days of losses through Wednesday, its longest losing streak this year. The potential for a government shutdown looms in the next few days as the White House and Republican-led Congress square off in a budget fight.

The S&P 500 index rose four points, or 0.2 percent, to 1,696 as of 10:54 a.m. Eastern Daylight Time. The Dow Jones industrial average advanced 43 points, or 0.3 percent, to 15,317. The Nasdaq composite gained 21, or 0.6 percent, to 3,781.

"There's a little bit of a bounce here," said Robert Pavlik, chief market strategist at Banyan Partners. "It may be a little bit of bargain hunting."

The number of Americans seeking unemployment benefits fell 5,000 last week to a seasonally adjusted 305,000, the Labor Department said Thursday. Steady declines in applications indicate that fewer companies are laying off workers.

Economic growth accelerated to a 2.5 percent annual rate from April through June, the Commerce Department reported. The economy grew 1.1 percent in the January-March quarter.

In government bond trading, the yield on the 10-year note climbed to 2.66 percent from 2.63 percent late Wednesday.

The price of oil rose 16 cents, or 0.2 percent, to $102.85 a barrel. Gold fell $3.60, or 0.3 percent, to $1,322.50 an ounce.

Among stocks making big moves:

— Bed Bath & Beyond rose $3.95, or 5.3 percent, to $78.16 after the company said Wednesday its quarterly profit increased 11 percent on stronger sales. That figure beat expectations of Wall Street analysts.

— Hertz fell $2.81, or 11 percent, to $22.97 after the company cut its earnings and revenue forecasts because of weaker-than-expected volume for U.S. airport car rentals.

— Caesars Entertainment fell $1.08, or 5 percent, to $19.90 after the company said late Wednesday that it plans to sell up to 11.5 million of its shares in a public offering.