Stock averages extend their win streak to five sessions, with each of the major indexes up about 1%.
Soggy pre-market trading gave some indication that investors might pocket a portion of the four-day uninterrupted charge for stocks, but improved economic data and a boosted sales outlook from Procter & Gamble (
PG) gave new life the broader market's advance.
The Labor Department said claims fell to a seasonally adjusted 550,000 from an upwardly revised 576,000 in the previous week. Analysts expected claims to drop to 560,000, according to Thomson Reuters. The number of people continuing to receive benefits fell by 159,000 to nearly 6.1 million, the lowest level since early April. This could be a sign that job losses are coming to an end soon as the economy bottoms.
Procter & Gamble (
PG) gained after it confirms it FY 2010 and Q1 guidance for organic sales growth. The company also said it expects to return to organic sales growth in Q2 compared to prior year levels following two quarters of organic sales declines.
P&G's upbeat outlook was weighed against an earnings warning from Monsanto (
MON). MON says it expects 2009 ongoing earnings to come in at the low end of its expectations of $4.40 to $4.50 per share. It sees FY10 between $3.10 to $3.30, also below analysts' expectations. It also says it expects more job cuts.
Airlines generally got a boost from JP Morgan. JP Morgan downgraded JetBlue (JBLU) to "neutral;" upgraded US Airways (
LCC) to "neutral," upgraded UAL (
UAUA) to "overweight" and downgraded AirTran (AAI) to "neutral."
The tech-laden Nasdaq got some support from earnings and forecasts. ASML Holding NV (ASML) reports a business pick-up above previous guidance resulting mainly from the short- and mid-term needs in the DRAM memory and Logic segments. This will translate into Q3 and Q4 2009 net sales of above EUR 500 million each and Q3 2009 bookings significantly above that level. Previous guidance issued on July 15 was for Q3 2009 net sales of around EUR 450 million. ASML will report final Q3 results on October 14.
RF Micro Devices (
RFMD) also said demand is tracking ahead of plan, which is boosting the stock. RFMD is up about 7.5% while ASML is 1.4%.
