FOX Business: Capitalism Lives Here
A round of strong data on the U.S. economy, and a rate cut by the European Central Bank, sent stocks climbing on Thursday.
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As of 3:20 p.m. ET, the Dow Jones Industrial Average climbed 128 points, or 0.87%, to 14829, the S&P 500 gained 15.2 points, or 0.96%, to 1598 and the Nasdaq Composite rose 44.2 points, or 1.3%, to 3343.
The markets took a pounding on Wednesday on worries the U.S. labor market is struggling even more than some economists had feared. The focus on the world economy continued into Thursday.
In fact, economically-sensitive stocks performed the best. Energy, technology industrial and health-care stocks were leading the way. Meanwhile, utility and telecommunications stocks fared the worst.
The European Central Bank cut its main refinancing rate 0.25-percentage point to 0.5%. The move comes amid a slew of data suggesting the eurozone's economy is continuing to struggle under the weight of the 17-member currency bloc's debt crisis.
Indeed, a report from Markit showed the pace of the contraction in the eurozone's manufacturing picking up slightly in April from the month before. Particularly worrisome, economists said, were data suggesting Germany's factory sector contracting for the first time this year. Germany is Europe's economic powerhouse, and has managed to shake off the headwinds from the bloc's debt crisis.
There are also a handful of reports due out on the U.S. economy.
The Labor Department said new claims for unemployment benefits fell to 324,000 last week from an upwardly revised 342,000 the week prior. Claims were expected to fall to 345,000 from an initially reported 339,000. Meanwhile, employers announced plans to cut 38,121 jobs in April, representing a 23% drop from March, and a 6% decline from the year prior, according Challenger, Gray & Christmas.
The labor market has come under intense focus as the Federal Reserve has said it is prepared to continue its aggressive easing plan until the unemployment rate falls to 6.5%. The latest round of monthly job figures from the Labor Department is due out on Friday.
Another report from the Commerce Department showed the U.S. trade gap narrowing to $38.8 billion in March from $43.6 billion in February, coming in considerably narrower than estimates of $42 billion. The measure figures into first-quarter gross domestic product.
In commodities, the benchmark U.S. crude oil contract zoomed higher by $2.99, or 3.3%, to $94.02 a barrel. Wholesale New York Harbor gasoline gained 1.9% to $2.771 a gallon. Gold jumped $20.20, or 1.4%, to $1,466 a troy ounce.
Facebook (NASDAQ:FB) revealed first-quarter profits that narrowly missed expectations, but sales that exceeded forecasts after the bell on Wednesday. Shares of the world's biggest social network were higher on the news.