Encouraging economic news lifts stocks
NEW YORK - Encouraging news about the U.S. economy boosted the stock market Wednesday. In a sign that workers are in less danger of being laid off, the number of Americans seeking unemployment benefits dropped 10,000 last week to a seasonally adjusted 316,000, the Labor Department said. A private survey by the University of Michigan and financial data company Thomson Reuters showed that consumer confidence rose in November.
NEW YORK - Encouraging news about the U.S. economy boosted the stock market Wednesday.
In a sign that workers are in less danger of being laid off, the number of Americans seeking unemployment benefits dropped 10,000 last week to a seasonally adjusted 316,000, the Labor Department said. A private survey by the University of Michigan and financial data company Thomson Reuters showed that consumer confidence rose in November.
"Today's economic news was generally favorable," said Terry Sandven, chief equity strategist for U.S. Bank Wealth Management. "In the absence of bad news, the path of least resistance for equities is up."
The stock market is trading at record levels on a combination of solid corporate earnings, a slowly recovering economy, and easy-money policies from the Federal Reserve. The Fed is buying $85 billion in bonds every month to keep long-term interest rates low, making bonds less attractive than stocks for investors.
The Standard & Poor's 500 index climbed 4.48 points, or 0.25 percent, to 1,807.23. The Dow Jones industrial average rose 24.53 points, or 0.15 percent, to 16,097.33.
The biggest gainer among major stock indexes was the Nasdaq composite, which closed above 4,000 for the first time in 13 years Tuesday. The index advanced Wednesday by 27.00 points, or 0.67 percent, to 4,044.75.
The S&P 500 is on course for its best annual performance since 1998. Much of the gain has come because investors have been willing to pay more for a company's stock in relation to its earnings.
The price-earnings ratio for S&P 500 companies has climbed to 15.1 from 12.6 at the start of the year - still below the 20-year average of 16.5.
Trading volumes were lower than average ahead of the Thanksgiving holiday, when markets will be closed. The New York Stock Exchange and the Nasdaq also will close early Friday.
The yield on the 10-year Treasury note rose to 2.74 percent from 2.71 percent Tuesday. The price of oil dropped Wednesday to its lowest level since early June as the U.S. government reported the 10th straight weekly increase in crude supplies. Oil dropped $1.53, or 2 percent, to $92.14 a barrel.
Gold fell $1.90, or 0.2 percent, to $1,239.50 an ounce.