Wall Street jumps on strong consumer and jobs data
NEW YORK (Reuters) - The S&P 500 scored its best day in seven weeks on Thursday as bullish consumer confidence and private-sector jobs data gave investors reason to cheer following superstorm Sandy's devastating sweep through the U.S. Northeast.
Technology and materials sector shares led the advance in a day of mostly average volume. About 6.7 billion shares changed hands on the New York Stock Exchange, Nasdaq and NYSE MKT, compared with the average daily closing volume of 6.5 billion for the year to date. The S&P 500 technology index .GSPT rose 1.8 percent, while the PHLX semiconductor index .SOX surged 3.3 percent. The S&P materials index .GSPM shot up 2 percent.
Volume had been expected to jump after Sandy forced a historic two-day weather-related market closure earlier in the week but traders said participation remained light to normal.
Data from payrolls processor ADP showed U.S. companies added 158,000 workers in October - the fastest pace in eight months. In another encouraging sign, U.S. consumer confidence jumped in October to its highest in more than four years, the Conference Board said.
The numbers showed a slightly more positive picture of the U.S. economy a day ahead of Friday's nonfarm payrolls report, the most widely watched U.S. economic indicator.
"In all, it bodes well for the bull side, and finally gave some investors a catalyst to buy," said Alan Lancz, president of Alan B. Lancz & Associates, an investment advisory firm in Toledo, Ohio.
"Tomorrow will be more of a trump card and can take it all away."
Employers are expected to have added 125,000 jobs to payrolls in October, up from 114,000 in September, according to a Reuters survey of economists. The unemployment rate is forecast to have inched up to 7.9 percent after a dramatic drop of 0.3 percentage point in September.
Pfizer Inc (PFE.N), which delayed the release of its quarterly results because of the storm, posted revenue that fell far short of expectations, pushing its stock down 1.3 percent to $24.55.
Shares of Exxon Mobil Corp (XOM.N), which like Pfizer is a Dow component, gained 0.5 percent to $91.60 after the world's largest publicly traded oil company reported a quarterly profit that slipped from a year ago, although it still topped expectations. Exxon's oil and gas output, however, declined more than expected.
Northeast residents and workers were still recovering from the aftermath of Sandy, which killed scores of people in North America and the Caribbean, and wreaked havoc up and down the U.S. eastern seaboard.
The Dow Jones industrial average .DJI gained 136.16 points, or 1.04 percent, to 13,232.62 at the close. The Standard & Poor's 500 Index .SPX shot up 15.43 points, or 1.09 percent, to finish at 1,427.59. This was the S&P 500's biggest daily percentage gain since September 13, when the Federal Reserve unveiled its plan for a third round of stimulus or quantitative easing, also known as "QE3."
The Nasdaq Composite Index .IXIC jumped 42.83 points, or 1.44 percent, to close at 3,020.06.
After the bell, shares of Starbucks (SBUX.O) rose 6.2 percent to $49.50 after it reported a higher quarterly profit and raised its full-year forecast. The stock closed the day at $46.62.
During the regular session, official and private-sector factory surveys in China that showed the world's second-biggest economy regaining some traction added to support for stocks.
Shares of JDA Software Group JDAS.O, a maker of supply-chain management software, soared 17.3 percent to $44.76 after the company agreed to be bought by privately held rival RedPrairie Corp for about $1.9 billion in cash.
Advancers outnumbered decliners on the New York Stock Exchange by a ratio of slightly more than 3 to 1, while on the Nasdaq, about two stocks rose for every one that fell.