US stocks close higher as investors parse Fed’s next move
NEW YORK (AP) — Stocks are closing modestly higher as investors parse the latest news on the job market and try to anticipate what’s next for U.S. interest rates.
The Dow Jones industrial average rose 76 points, or 0.5 percent, to close at 16,330 Thursday.
The Standard & Poor’s 500 index gained 10 points, or 0.5 percent, to 1,952. The Nasdaq composite climbed 39 points, or 0.8 percent, to 4,796.
Freight company Con-Way soared 34 percent after agreeing to be acquired by XPO Logistics.
Lululemon sank 16 percent after the high-end apparel maker predicted profits for the current quarter that were lower than Wall Street analysts were expecting.
Bond prices fell slightly. The yield on the 10-year Treasury note rose to 2.23 percent.
MORE ON JOBS: Fewer Americans applied for unemployment benefits last week, keeping this key indicator of the labor market near historic lows. The Labor Department said weekly applications benefits dropped 6,000 to 275,000.
FED WATCH: On Wednesday a separate report from the government indicated that U.S. job openings jumped to the highest level in 15 years in July. A report last Friday showed the unemployment rate fell to a seven-year low of 5.1 percent in August. More evidence that the job market remains strong may prompt the Fed to raise interest rates at its meeting next week for the first time since the 2008 financial crisis. Ultra-low rates have been a boon for stocks.
THE QUOTE: “The Fed has to be mindful of all this job creation because, sooner or later, companies are going to have to compete for workers, and they’re going to compete by raising wages,” said David Joy, chief market strategist at Ameriprise Financial. “That will filter into the Fed’s deliberations next week.”
DOUGHNUT HOLE: Krispy Kreme Doughnuts plunged $2.14, or 12 percent, $15.59 after the company lowered its outlook following disappointing second-quarter results.
LEMON OF A STOCK: Lululemon sank $9.70, or 15 percent, to $54.29 after the high-end apparel maker predicted profits for the current quarter that were lower than Wall Street analysts were expecting.
LINKING UP: Freight company Con-Way soared $11.92, or 34 percent, to $47.45 after agreeing to be acquired by XPO Logistics.
EUROPE DOWN: Britain’s FTSE 100 fell 1.2 percent and France’s CAC 40 dropped 1.5 percent. Germany’s DAX was down 0.9 percent.
ASIA’S DAY: Japan’s Nikkei 225 sagged 2.5 percent after surging 7.7 percent on Wednesday in its biggest gain since October 2008. Hong Kong’s Hang Seng index dropped 2.6 percent and China’s Shanghai Composite Index finished 1.4 percent lower. South Korea’s Kospi turned up 1.4 percent.
ENERGY: Benchmark U.S. crude rose $1.49 to $45.64 a barrel on the New York Mercantile Exchange.
BONDS, CURRENCIES: Bond prices fell slightly. The yield on the 10-year Treasury note rose to 2.23 percent from 2.20 percent late Wednesday. The U.S. dollar rose to 120.59 yen from 120.28 yen. The euro rose to $1.1287 from $1.1219.
METALS: The price of gold rose $7.30 to $1,107.30 an ounce. Silver rose 7 cents to $14.65 an ounce and copper gained a penny to $2.45 per pound.