Lower euro-zone yields, China GDP view lift Wall Street
By Angela Moon
NEW YORK (Reuters) - U.S. stocks rose more than 1 percent on Thursday as lower Italian bond yields eased some euro-zone concerns and rumors about China's strong GDP growth bolstered investors' appetite for risk.
The S&P 500 popped above its 50-day moving average in a sign that traders may see the recent pullback of nearly 5 percent as an opportunity to catch up with the benchmark's performance. The index is up more than 10 percent for the year to date.
In a sign that the labor market's recovery may be stalling, government data showed new claims for unemployment benefits rose unexpectedly last week to their highest level since January. But some economists cited the Easter holidays for the spike in claims, adding that they expected applications will keep declining in the weeks ahead.
Benchmark bond yields in Italy and Spain dropped following solid demand at this week's Italian debt auctions, while the euro hit a one-week high against the U.S. dollar, indicating a reduction in near-term concern about the euro zone's debt troubles.
"The easing bond yields are a signal to investors here that things aren't quite that bad in Europe," said Brian Gendreau, market strategist with Cetera Financial Group.
The Dow Jones industrial average .DJI was up 169.72 points, or 1.32 percent, at 12,975.11. The Standard & Poor's 500 Index .SPX was up 16.66 points, or 1.22 percent, at 1,385.37. The Nasdaq Composite Index .IXIC was up 35.26 points, or 1.17 percent, at 3,051.72.
Basic materials shares led gains as the euro climbed against the U.S. dollar and commodity prices advanced. The S&P materials sector index .GSPM jumped 2.8 percent. U.S. Steel (X.N: Quote) gained 5.9 percent to $28.94. Freeport-McMoRan Copper & Gold (FCX.N: Quote) rose 6 percent to $37.93.
Early into earnings season, results are beating Wall Street's expectations at a fast clip. Analysts say the expectations could have been lowered too much and stocks can seem cheap after the S&P's recent pullback of almost 5 percent. Continued...