After Market: Dow Sets 6th Straight Record as Investors Cheer Good Jobs News

Stocks Rise On Strong Economic Report For US Economy
John Moore/Getty Images
By KEN SWEET

NEW YORK -- The stock market continued its upward climb Thursday as traders went back to work after the Christmas holiday, adding to what has already been a historic year for the market.

Traders were encouraged by an unexpectedly large drop in claims for unemployment benefits last week, the latest sign that the U.S. job market is improving. Trading volume was very low, however, as most portfolio managers have closed out their positions for the year

The yield on the 10-year Treasury note, a benchmark for many kinds of loans, briefly crossed above the psychologically important 3 percent mark. It hasn't been that high since September.

The Dow Jones industrial average (^DJI) rose 122.33 points, or 0.8 percent, to 16,479.88. It was the 50th record high close for the Dow this year. The index is up 25.8 percent so far in 2013, on pace to have its best year since 1996.

The Standard & Poor's 500 index (^GPSC) rose 8.70 points, or 0.5 percent, to 1,842.02 and the Nasdaq composite (^IXIC) was up 11.76 points, or 0.3 percent, to 4,167.18.
With Thursday's gains, the S&P 500 is up 29.2 percent for the year, or 31.3 percent when dividends are included. The S&P is on track for its best year since 1997.

Bond prices fell, pushing the yield on the 10-year Treasury note to 2.99 percent from 2.98 percent Tuesday. The note briefly traded above 3 percent.

Yields have been climbing since late November as economic reports have suggested that the U.S. recovery is gaining momentum. The increase accelerated last week after the Federal Reserve announced it was cutting back on its bond-buying program. The yield last touched 3 percent in September. It hasn't been consistently above 3 percent since July 2011.

"There's a silver lining to see bond yields rise like this, because it's a sign that the economy is getting stronger," said John De Clue, chief investment officer of U.S. Bank Wealth Management.

Yields on Treasury securities like the 10-year note are used to calculate interest rates on student loans, mortgage rates, credit cards, and many other kinds of debt. As the 10-year yield has risen in the last six months, so have mortgage rates. In early May, the average mortgage rate was around 3.35 percent. This week it was 4.48 percent, according the government mortgage agency Freddie Mac.

"We are starting to take the medication away from the bond market, but it's important to note that yields are still at historically low levels," said Dan Veru, chief investment officer of Palisade Capital Management, which manages $4.5 billion in assets.

Investors cheered the latest signal that the U.S. economy is improving. The Labor Department said the number of Americans who filed for unemployment benefits fell 42,000 last week to 338,000. The drop was far bigger than economists were expecting and an indication that fewer people were losing their jobs.

It was another slow day for Wall Street, with most investors on vacation for Christmas and only three trading days left in 2013. Approximately 1.96 billion shares traded hands on the New York Stock Exchange on Thursday, well below the daily average of 3.3 billion shares.

In Corporate News:

T-Mobile (TMUS) rose 74 cents, or 2.3 percent, to $32.93 after The New York Times and other news outlets reported that the Sprint division of Japan's Softbank was looking to buy the wireless carrier.

Twitter (TWTR) rose $3.35, or 5 percent, to $72.31. The stock is up 22 percent this week alone and 76 percent so far this month. Investors continue to bid up Twitter's shares on optimism the social media company can increase profits from mobile advertising.

What to Watch Friday:
  • The Energy Information Administration releases its weekly report on U.S. petroleum stockpiles at 11 a.m. Eastern time.

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48 Comments

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toosmart4u

Way to go President Obama, rough job cleaning up the mess from Bush Jr\'s administration. 6.5 trillion debt from the Iraq war and so far 3.5 trillion debt from Afgh war and counting.

December 27 2013 at 3:38 AM Report abuse +1 rate up rate down Reply
1 reply to toosmart4u's comment
Mickylitz

toosmart4u ,,

Thanks for the made up numbers .....

We're talking about the high stock market here which the left is taking credit for , unfortunately it's as usual manipulated .


You can thank the Federal Reserve, which is pumping $85 billion per month of thin-air money into the markets. Quite simply, this bull market is being fueled by all the funny money being spun out of the Fed's printing press. Hundreds of billions in new money has been flowing into the stock market, which is pushing the averages to new highs.

This stock market run-up is nothing more than an illusion of economic well-being created by the Fed. It is entirely lacking in fundamentals.

December 27 2013 at 7:51 AM Report abuse rate up rate down Reply
revivalman

When the bubble bursts, as it surely will, and maybe in 2014, Obama better be on his way back to Kenya.

December 27 2013 at 2:30 AM Report abuse -3 rate up rate down Reply
1 reply to revivalman's comment
Mickylitz

revivalman ,,
That would definitely be a blessing.....

December 27 2013 at 8:23 AM Report abuse rate up rate down Reply
Anthony J. Alfidi

Unemployment claims dropped because people who reach the end of the 99-week benefits are switching to Social Security disability claims.

BLS statisticians are also dropping discouraged workers from the workforce. These statistics are doctored.

December 26 2013 at 11:13 PM Report abuse -1 rate up rate down Reply
1 reply to Anthony J. Alfidi's comment
drpmindmender

The 328,000 figure is for NEW claims for unemployment, NOT for ongoing cases of those already receiving unemployment.

December 27 2013 at 6:29 AM Report abuse +1 rate up rate down Reply
drmike15

There was a time when Wall Street got rich while Main Street got rich. Now, however, in the post-prosperity economy Wall Street gets rich precisely to the extent that Main Street is impoverished and destroyed.

December 26 2013 at 9:37 PM Report abuse +1 rate up rate down Reply
jim.lapt

Obama is the greatest soon we will have a third world country. I love Obama

December 26 2013 at 9:22 PM Report abuse -4 rate up rate down Reply
Iselin007

Where is Dweeb Buster?

December 26 2013 at 9:20 PM Report abuse rate up rate down Reply
Iselin007

Over 30,000 supposedly dropped out of the November labor force in NJ so I just hope it wasn't due to undiscovered crimes in Essex County!

December 26 2013 at 9:17 PM Report abuse -3 rate up rate down Reply
Iselin007

I'm curious on how many Online sales were purchases of merchandise on those stolen credit card numbers?

December 26 2013 at 9:09 PM Report abuse -1 rate up rate down Reply
Iselin007

There has been an increase in manufacturing in the November NJ report. I hope the increase was not due to the arrests and convictions for criminal acts because an increase in License plates may surpass the amount of cars that are sold.

December 26 2013 at 8:54 PM Report abuse -4 rate up rate down Reply
Iselin007

The day after Christmas the local mall was very slow tonight.

December 26 2013 at 8:34 PM Report abuse -3 rate up rate down Reply