NEW YORK (AP) - Better news on jobs and consumer spending pushed stocks higher early Thursday.
NEW YORK (AP) — Better news on jobs and consumer spending pushed stocks higher early Thursday.
The Dow Jones industrial average rose more than 100 points after the first half-hour of trading, putting it on track for its third jump in as many days. Bond yields eased for a second day, easing worries that a sudden spike in interest rates could hurt the economy.
Consumer spending rose 0.3 percent last month as incomes increased at the fastest pace in three months, the government reported. The number of Americans seeking unemployment benefits fell 9,000 to 346,000 last week. The report added to evidence that the job market is improving modestly.
The stock market has rallied in the last three days as investors took advantage of lower prices after a sell-off last week. The plunge came after Federal Reserve Chairman Ben Bernanke said that the central bank could cut back on its stimulus later this year and possibly end it next year, if the economy continued to improve.
The central bank is buying $85 billion of bonds every month to hold down long-term interest rates and encourage spending. Fed's stimulus has underpinned a stock market rally that started in March 2009 by encouraging investors to put money into risky assets.
"What's driving that market up is that people are realizing that they are in a 'win-win' situation," said Rick Robinson, a regional Chief Investment Officer at Wells Fargo Private Bank. "If you have good economic data that should be good for stocks, if you have poor economic data....that means the Fed will probably have its (stimulus) longer."
The Dow Jones industrial was up 125 points, or 0.8 percent, to 15,035 as of 10:10 a.m. Eastern Daylight Time.
The Standard & Poor's 500 index climbed 11 points, or 0.7 percent, to 1,617. All 10 industry groups in the index rose, led by telecommunications stocks.
The yield on the 10-year Treasury note fell to 2.48 percent from 2.54 percent. The yield climbed as high 2.66 on Monday, its highest since August 2011. The rate has surged since May 3, when it touched its low for the year of 1.63 percent. Concern that the Fed is poised to start pulling back on its stimulus prompted investors to sell bonds, pushing the yield higher. A higher yield on the note translates to higher borrowing costs on many kinds of loans including home mortgages.
In commodities trading, the price of oil rose 52 cents, or 0.55 percent, to $96.05 a barrel. Gold recovered after a plunge the day before. Gold rose $2.80, or 0.2 percent, to $1.232.30 an ounce.
In other trading, the Nasdaq composite rose 27 points, or 0.8 percent, to 3,403.
The dollar fell against the euro and the Japanese yen.
Among stocks making big moves:
— ConAgra Foods rose $1.30, or 4 percent, to $34.68 after the company posted a quarterly profit that came in a penny above the expectations of Wall Street analysts. The maker of Chef Boyardee, Hebrew National and other packaged foods benefited from acquisitions and price cuts that helped increase sales. —Payroll processor Paychex fell $1.45, or 3.8 percent, to $36.53 after posting earnings that fell short of analysts' expectations. The company said profit for the three months through May 31 came in roughly flat at 34 cents per share. Analysts had expected earnings of 37 cents a share. — KB Home rose 54 cents, or 2.7 percent, to $20.43, after the homebuilder's second-quarter loss narrowed. The company continued to deliver more homes at higher prices as the real estate market strengthens.