U.S. Stocks Rise on Economic Reports Amid Draghi Comments

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Initial Jobless Claims Increase From Two-Month Low

U.S. stocks rose, sending the Standard & Poor’s 500 Index higher for a fourth day, as reports on jobless claims and factory orders were better than forecast and theEuropean Central Bank said it stands ready to buy bonds. Financial and commodity companies rose the most, climbing at least 1 percent, as Bank of America Corp. (BAC) and Consol Energy Inc. (CNX) rallied more than 2.1 percent. TJX Cos. and Target Corp. (TGT) gained among retailers after September same-store sales topped estimates. Hewlett-Packard Co. slumped for second day after Chief Executive OfficerMeg Whitman’s turnaround strategy failed to convince investors looking for a speedier recovery.
The S&P 500 increased 0.5 percent to 1,458.02 at 11:36 a.m. in New York. The benchmark index has rallied 1.2 percent this week. The Dow Jones Industrial Average rose 67.54 points, or 0.5 percent, to 13,562.15. Trading in S&P 500 companies was 24 percent above the 30-day average at this time of day.
“In the last several weeks, we have coordinated global monetary stimulus, and that’s starting to show up in the change of trends in American economic statistics,” Douglas Cote, chief market strategist at New York-based ING U.S. Investment Management, said in a phone interview. His firm oversees about $165 billion. “Employment, manufacturing, services and consumer sentiment have all gone from weakening to strengthening.”
U.S. stocks rose as Labor Department figures showed applications for jobless benefits increased 4,000 to 367,000 in the week ended Sept. 29. Economists forecast 370,000 claims, according to the median estimate in a Bloomberg survey. Orders placed with U.S. factories fell 5.2 percent in August, the Commerce Department said. The median forecast of economists in a Bloomberg News survey called for a decline of 5.9 percent.

ECB Rates

ECB President Mario Draghi said the bank is ready to start buying government bonds as soon as the necessary conditions are fulfilled. The ECB kept interest ratesunchanged at a historic low of 0.75 percent.
The S&P 500 rose for a third day yesterday after ADP Employer Services said companies added 162,000 jobs last month, exceeding economists’ estimates. Tomorrow’s government jobs report may show that the economy created 115,000 jobs last month and the unemployment rate increased to 8.2 percent from 8.1 percent, economists forecast.
The Federal Open Market Committee will release the minutes of its latest policy meeting at 2 p.m. today.

‘Market Prism’

“The jobless claims report was OK and Draghi is signaling he will do whatever it takes, so I’m not expecting him to take his foot off the accelerator,” Philip Orlando, the New York- based chief equity strategist at Federated Investors Inc. which oversees about $370 billion, said in a phone interview. “Every data point in the U.S. will be viewed through a market prism and a political prism now.”
Companies that are most tied to economic swings led the gains as the Morgan Stanley Cyclical Index climbed 0.8 percent.
Financial shares rose the most among 10 groups in the S&P 500, climbing 1.1 percent. Bank of America rallied 2.8 percent to $9.37, while Citigroup Inc. (C) gained 2.1 percent to $34.76.
American International Group Inc. (AIG) rose 2.1 percent to $34.91. Daniel Loeb’s $9.3 billion Third Point LLC hedge fund added shares last quarter, betting the stock will rise as the U.S. cuts a stake acquired in the insurer’s rescue. AIG shares have “significant upside,” the New York-based fund said in a letter to investors.

Energy Shares

Energy shares advanced as oil rebounded from a two-month low and analysts forecast an end to coal’s longest slump in seven years. Consol Energy jumped 4.4 percent to $31.02 while Tesoro Corp. (TSO) increased 3.5 percent to $44.05.
TJX gained 0.8 percent to $45.56. Sales at the discount clothing seller climbed 6 percent, beating the average estimate for a 4.4 percent gain from analysts surveyed by researcher Retail Metrics Inc.
Target added 0.9 percent to $63.64. The second-largest U.S. discounter posted a 2.1 percent increase in same-store sales, topping the 2 percent projection.
Hewlett-Packard (HPQ) slumped 2.8 percent to $14.50 after plunging 13 percent yesterday. Meeting with analysts a year after taking over, CEO Whitman yesterday outlined steps that include more focus on corporate customers, narrower product lines and multi-featured machines, such as printers that double as scanners and copiers. She also said the turnaround wouldn’t happen any time soon and projected 2013 profit that missed analysts’ estimates.
Sprint Nextel Corp. (S) decreased 2.4 percent to $5.08, paring an earlier drop of 5.4 percent. The third-largest U.S. wireless carrier is in the early stages of evaluating whether it should make a counter offer for MetroPCS Communications Inc. to top Deutsche Telekom AG’s bid to combine it with T-Mobile USA, said three people familiar with the offer.

Estrategia Investimentos S.A.