* Jobless claims fall, ISM services index tops forecasts
* Syria in focus after resolution passes Senate committee
* Retailers post Aug sales; Costco beats expectations
* Indexes up: Dow 0.14 pct, S&P 0.24 pct, Nasdaq 0.32 pct
By Chuck Mikolajczak
NEW YORK, Sept 5 U.S. stocks rose modestly on
Thursday, putting equities on track for a third straight day of
gains to start the month, as a flurry of economic data pointed
to improving economic conditions.
Gains were limited as many investors were hesitant to make
big bets going into Friday's payroll report, while the
possibility of a Western-led strike against Syria also loomed.
While the economic data was positive, it did little to
change investor expectations about when the U.S. Federal Reserve
might begin to ease its accommodative monetary policies,
credited with fueling the equity market's gains in 2013.
"You've got the economy is taking us to a happy place, the
international situation is taking us to a not-so-happy place and
the Federal Reserve - nobody knows how that will react, so it's
just waiting," said Ron Florance, deputy chief investment
officer at Wells Fargo Private Bank in Scottsdale, Arizona.
The ADP National Employment report showed U.S. private
employers added 176,000 jobs in August, nearly matching
expectations for a gain of 180,000 jobs, while weekly initial
jobless claims fell more than expected to a seasonally adjusted
Separately, the Institute for Supply Management's read on
the services sector rose more than expected in August, while
factory orders fell less than had been anticipated.
The Dow Jones industrial average rose 20.3 points or
0.14 percent, to 14,951.17, the S&P 500 gained 4.03
points or 0.24 percent, to 1,657.11 and the Nasdaq Composite
added 11.751 points or 0.32 percent, to 3,660.793.
The benchmark 10-year U.S. Treasury note was
down, with the yield climbing to a 25-month high. Analysts said
the rout in Treasuries in recent months could persist.
"The economy can tolerate quite a bit of an increase in
interest rates before we see any real deceleration of economic
activity, but that is the wild card," said Florance.
After falling 3.1 percent in August, its worst monthly
performance since May 2012, the benchmark S&P index has kicked
off September with a 1.5 percent advance thus far.
Geopolitical concerns also kept investors on the sidelines
after the Senate Foreign Relations Committee backed a resolution
for military strikes against Syria in retaliation for a possible
chemical weapons attack against civilians.
Market moves have recently been driven by the likelihood of
a Western-led strike, with investors attuned to any possible
impact on oil supplies.
Retail stocks rose as the group reported August sales. Many
U.S. retailers reported stronger-than-expected sales, but had to
use steep discounts to attract back-to-school shoppers.
Costco Wholesale Corp reported same-store sales
that beat expectations despite lower fuel prices, sending shares
up 2.1 percent to $113.87. The Morgan Stanley retail index
gained 0.7 percent.
In merger news, Otsuka Pharmaceutical agreed to buy U.S.
cancer firm Astex Pharmaceuticals for $886 million
while Sweden's SKF agreed to acquire Kaydon Corp
for $1.25 billion.
Astex rose 2.5 percent to $8.48 while Kaydon jumped 22.9
percent to $35.53.