Indexes closed slightly higher Thursday as positive economic news indicated a consolidation of the overall job market even as oil prices rose. Treasuries continued their southward journey for the second day as risk appetite improved and Fed Chairman Ben Bernanke refused to commit further monetary stimulus to boost growth. Bernanke repeated his “positive developments” in the job market testimony in the senate today and failed to mention about QE3 that pushed through yesterday’s sell-off in Treasuries.
US stocks scaled back and managed to stay up after Institute for Supply Management reading showed expansion slowing in Feb. The ISM manufacturing index fell 1.57 points to 52.4 in February though was it expected to rise to 54.7. Any reading above 50 reflects overall expansion.
According to the US Census Bureau, construction spending dropped 1 percent in January.
The Dow Jones Industrial Average (DJIA) added 28.23 points, or 0.2 percent, to close at 12,980.30, with J.P. Morgan Chase leading today’s gains, up 2.9 percent. The S&P 500 (SPX) gained 8.41 points, or 0.6 percent, to close at 1374.09 on Thursday. It has added 9.3 percent so far since January, with financial companies leading today’s rally. The tech-heavy NASDAQ Composite Index (COMP) rose 22.08 points, or 0.7 percent, to 2,988.97.
US 10-year yield rose 0.06 percentage point to 2.03 percent today, its highest level in a week after corporate bonds topped treasuries as the economy pushed forward. US 30-year bond yields rose six basis points to end at 3.15 percent, the highest level since Feb. 22. The iShares Barclays 20 Year Treasury Bond ETF (TLT) shed 1.37 points, or 1.16 percent, for the day while the Vanguard Total Bond Market ETF (BND) lost 0.33 points, or 0.39 percent over yesterday.
Retailer Gap Inc.’s (GPS) shares advanced 7.2 percent on the S&P 500 after Feb. sales came in better-than-expected. Automaker Ford Motor Co (F) climbed after Feb. sales soared 12 percent. Fellow carmakers General Motors (GM) and the Chrysler Group also reported big jump in Feb. sales. Wal-mart Stores Inc. (WMT) shed 0.44 percent after the supermarket chain operator hiked annual dividend nine percent to $1.59 per share.