US STOCKS-S&P 500 hits record on data, ECB; focus shifts to jobs report

Thu Mar 6, 2014 3:34pm EST

* Three-month low in U.S. jobless claims offers hope for labor market

* Nonfarm payrolls report due Friday; job growth likely picked up

* Staples, Costco shares down after results, weigh on Nasdaq

* Indexes: Dow up 0.4 pct, S&P up 0.3 pct, Nasdaq down 0.1 pct

By Angela Moon

NEW YORK, March 6 (Reuters) - U.S. stocks mostly rose on Thursday, with the S&P 500 hitting a record after better-than-expected jobless claims data ahead of Friday's all important nonfarm payrolls report.

Boosting appetite for riskier assets, the European Central Bank decided not to take any action at its meeting on Thursday because economic and monetary conditions had not changed enough to warrant it. The euro hit its highest level against the U.S. dollar since late December.

Investors' focus shifted to Friday's employment data, due at 8:30 a.m. ET, which is likely to show job growth in the U.S. picked up enough in February to encourage the Federal Reserve to continue to scale back its monetary stimulus. But the gain was likely to be tepid given the unrelentingly harsh winter.

"There isn't much action today in terms of direction and volume on caution ahead of the jobs report tomorrow," said Ryan Detrick, analyst at Schaeffer's Investment Research in Cincinnati, Ohio.

With less than a hour left in trading, about 4.9 billion shares traded on U.S. exchanges, according to data from BATS Global Markets, below the daily average of about 7 billion in the past month.

The biggest gainers were stocks in basic materials, financial and industrial sectors, often associated with strong economic fundamentals. The S&P basic materials index was up 0.4 percent, the S&P financial index was up 0.8 percent and the S&P industrials index was up 0.5 percent.

But the Nasdaq 100 fell 0.2 percent, led lower by Staples, which lost 15 percent to $11.39. The largest U.S. office supplies retailer forecast a decline in sales. Staples also said it would close up to 225 stores in the United States and Canada by 2015.

The Dow Jones industrial average rose 71.49 points or 0.44 percent, to 16,431.67, the S&P 500 gained 4.1 points or 0.22 percent, to 1,877.91 and the Nasdaq Composite dropped 5.914 points or 0.14 percent, to 4,352.06.

Crimea's parliament voted to join Russia and its Moscow-backed government set a referendum for 10 days' time on the decision in a dramatic escalation of the crisis in the Ukrainian Black Sea peninsula.

U.S. President Barack Obama took steps to punish those involved in threatening Ukraine while European Union leaders agreed to suspend visa and investment talks with Russia.

An index of Moscow stocks lost more than 2 percent after the vote in Crimea, but pared the losses and closed down 1 percent. The rouble weakened 0.4 percent versus the U.S. dollar. A U.S.-traded Russian ETF fell 1.3 percent to $23.37.

With the S&P 500 at a record and lingering tensions between Ukraine and Russia, investors turned to the options market for hedges against a market decline. The S&P 500 climbed to an all-time intraday high of 1,881.94 earlier in the session.

Put buying in the SPDR S&P 500 ETF continued, with the weekly $185 and $187 strikes that expire Friday garnering the most interest as of Wednesday's close, according to Schaeffer's Investment Research. The ETF was up 0.3 percent at $188.22.

Costco Wholesale Corp was down 1.8 percent at $114 after the warehouse retailer reported a bigger-than-expected 15 percent fall in quarterly profit as unusually deep discounting in the holiday shopping season hurt margins.

Weekly applications for U.S. unemployment insurance fell to 323,000, the lowest in three months, a sign of strength in a labor market that has been hobbled by severe weather. New orders for U.S. factory goods, however, fell more than expected in January and shipments also slipped, adding to signs of a recent slowdown in manufacturing activity.

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