Stocks: Thursday's review
Japanese stocks rose as signs of a strengthening U.S. job market overshadowed concern political unrest in the Middle East and North Africa will drive energy costs higher.
Shares extended gains after a report that Venezuelan President Hugo Chavez called Libyan leader Muammar Qaddafi and offered to help broker peace.
Bridgestone Corp., the world’s largest tiremaker, climbed 2.2 percent.
Fanuc Corp., an industrial-robot manufacturer that gets almost 80 percent of its sales overseas, increased 1.2 percent.
TDK Corp., the world’s No. 1 maker of disk drive heads, gained 0.9 percent to 5,460 yen.
Advantest Corp., the No. 1 maker of chip-testing equipment, gained 1.5 percent after JPMorgan Chase & Co. raised its recommendation on the semiconductor industry.
Okuma Corp. (6103), a manufacturer of machine tools, jumped 6.3 percent after Nomura Holdings Inc. rated it a “buy.”
Mitsubishi Heavy Industries Ltd. leapt 5.4 percent to 372 yen, the most since December 2009, after the heavy machinery maker and Itochu Corp., a trading company, received an order to supply train cars and equipment for a transit project in Macau.
Softbank Corp., Japan’s third-biggest wireless carrier, rallied 4.8 percent to 3,410 yen and was the largest single contributor to gains in the Nikkei and the Topix. Mizuho Securities Co. reiterated its “outperform” rating on the shares, saying the carrier isn’t likely to increase its stake in Yahoo Japan Corp. Softbank declined as much as 4.6 percent yesterday after Reuters said Yahoo! Inc. of the U.S. may sell its 35 percent stake in Yahoo Japan.
Nippon Telegraph & Telephone Corp., Japan’s biggest telecommunications company, climbed 1.5 percent to 4,130 yen, the highest close since September 2009. JPMorgan reiterated its “overweight” rating on the company, citing the company’s forecast for higher profits this year.
European stocks rose as better-than- estimated earnings from Anheuser-Busch InBev NV (ABI) to Adecco SA (ADEN) outweighed European Central Bank President Jean-Claude Trichet’s suggestions that the ECB may boost interest rates next month.
AB InBev, the brewer of Stella Artois and Bud Light, and Adecco, the world’s largest supplier of temporary workers, advanced more than 2 percent.
British Sky Broadcasting Group Plc (BSY) gained 3 percent after News Corp. won approval to take full control of the company.
Rival U.K. media companies declined. Daily Mail and General Trust Plc, the publisher of the Daily Mail newspaper, slid 3.1 percent to 540 pence, the biggest drop since November. Broadcaster ITV Plc (ITV) fell 3.1 percent to 90.55 pence. Trinity Mirror Plc (TNI), which publishes the Daily Mirror, sank 22 percent to 66 pence even after full-year operating profit rose 17 percent.
Alcatel-Lucent led technology shares higher, surging 6.4 percent to 3.83 euros. There is speculation that an Chinese firm may make a bid for France’s largest telecommunications equipment maker, according to Jean-Michel Salvador, an analyst at AlphaValue in Paris. Alcatel spokeswoman Alix Cavallari declined to comment.
Ericsson AB, the world’s biggest maker of wireless phone networks, rallied 3.5 percent to 81.3 kronor after UBS AG upgraded its recommendation on the shares to “buy” from “neutral.”
Banco Santander SA (SAN) led banks lower as Trichet said “strong vigilance is warranted” and an “increase of interest rates in the next meeting is possible.”
U.S. stocks posted their best day in three months on Thursday as Wall Street rallied behind a strong unemployment claims report along with a modest drop in energy prices.
At the preliminary close, the Dow Jones industrial average (INDU) rose 191 points, or 1.6%, to 12,258. The gains were the best for the blue-chip indicator in 2011 and the largest since Dec. 1.
Thursday's rally was fairly broadbased and held steady the entire day. Twenty of the Dow's 30 members advanced more than 1%, while the worst-performing member of the Dow was AT&T (T, Fortune 500), falling a modest 0.1%.
Economy: The Labor Department reported that weekly jobless claims totaled 368,000 in the week ended Feb. 26 -- the lowest weekly figure since May 31, 2008.
Analysts surveyed expected the number of people filing for unemployment benefits to rise to 400,000, up from the revised tally of 388,000 the previous week.
The report came a day before the big labor report, the monthly employment figures from the government. Economists surveyed by CNNMoney expect that 192,000 jobs were created in February, with the unemployment rate rising to 9.1% from 9% in January.
The Institute for Supply Management's service industries index was also a positive force for the markets, rising to a stronger-than-expected reading of 59.7 for February. Economists had been looking for a reading of 59. Any reading above 50 signals expansion in the sector.
Companies: Valero Energy (VLO, Fortune 500) was the best-performing stock in the S&P 500 on Thursday, jumping 7.7%, after the oil refining company said it expects to post adjusted earnings between 76 cents and 91 cents a share, well ahead of the 48 cents a share analysts had forecast.
Shares of Big Lots (BIG, Fortune 500) rose 4% after the company reported a 15% increase in earnings to $1.46 a share. Analysts were looking for $1.38 a share.