Stocks go higher despite sales, job concerns

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NEW YORK -- Stocks pushed higher Thursday as investors tried to look past warnings of lackluster retail sales and a greater-than-expected increase in weekly jobless claims.

Retailers' reports on sales at stores open at least a year, an important measure known as same-stores sales, concerned some investors because of scattered warnings that sales would be light during April.

The number of Americans filing new claims for unemployment benefits rose last week to the highest level in two months. The Labor Department's weekly report, which Wall Street often regards as a volatile number, showed applications for jobless benefits totaled 342,000.

"I think investors are trying to figure out what the next Fed move is. We're really at the point of chicken -- where the Fed is trying to ward off inflation without submarining the economy," said Mark Coffelt, portfolio manager at Empiric Funds, referring to when the Federal Reserve might adjust short-term interest rates.

After a back-and-forth morning, the Dow Jones industrial average rose 34.94, or 0.28%, to 12,519.56.

Broader stock indicators also gained after being down in the first 90 minutes of trading. The Standard & Poor's 500 index rose 4.71, or 0.33%, to 1,443.58, and the Nasdaq composite index rose 14.30, or 0.58%, to 2,473.61.

Bonds advanced amid concerns of weaker corporate profits. The yield on the benchmark 10-year Treasury note fell to 4.73% from 4.74% late Wednesday. The dollar was mixed against other major currencies, while gold prices fell.

Higher oil prices have weighed on stocks in recent sessions. On Wednesday, weekly government figures showed a larger-than-expected decline in gasoline stockpiles. Light, sweet crude rose $1.03 to $63.04 on the New York Mercantile Exchange.

The modest moves in stocks Thursday follow a pullback Wednesday prompted by minutes from the Federal Reserve's last meeting that showed the central bank remains concerned enough about inflation that it won't rule out an increase in interest rates. The nearly 90-point drop in the Dow industrials Wednesday was perhaps bringing out some ebullient bargain hunters Thursday.

Some investors appeared to be awaiting clearer signals on the economy.

"I think we're probably OK on the profit front and probably OK on the economic front, but we're pretty close to that middle point where we could tip either way," Coffelt said.

News from retailers stirred some concern about how well sales will hold. While Wal-Mart Stores Inc. said same-store sales for the March period rose 4% -- well above the 1.6% Wall Street expected -- the company warned April will prove a difficult month. Customers of the world's largest retailers can be more sensitive than other consumers to gas prices, which have been increasing in recent months. Wal-Mart rose 2 cents to $47.29.

Federated Department Stores Inc., parent of Macy's and Bloomingdale's, warned its first-quarter sales will come in at the low end of expectations. Federated rose 66 cents to $45.52.

Meanwhile, quarterly earnings reports, which began arriving in earnest this week, haven't offered a strong catalyst to push stocks higher.

Research in Motion Ltd., maker of the BlackBerry handheld device, fell $10.96, or 7.5%, to $135.06 after the company disclosed that the Securities and Exchange Commission has formalized an investigation into the company's practices for granting stock options. The company said its fiscal fourth-quarter sales jumped 66%.

Genentech Inc. fell $2.38, or 2.9%, to $80.31 after the biotechnology company said first-quarter sales of its two key cancer treatments fell from the fourth quarter. The company's first-quarter profit surged 68%.

Mortgage lender NovaStar Financial Inc., which has struggled with its portfolio of so-called subprime mortgages, those made to people with poor credit, said it is considering putting itself up for sale. The stock rose 36 cents, or 7.2%, to $5.39.

Advancing issues outnumbered decliners by about 3 to 2 on the New York Stock Exchange, where volume came to 682.4 million shares.

The Russell 2000 index of smaller companies rose 2.49, or 0.31%, to 810.73.

Overseas, Japan's Nikkei stock average closed down 0.73%. Britain's FTSE 100 edged up 0.05%, Germany's DAX index closed down 0.14%, and France's CAC-40 finished down 0.05%.
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