Thursday, May 10, 2012

--Stocks rise after weekly jobless claims

--Europe turns up as Greek, Spanish markets rally

--Cisco Systems shares fall on downbeat outlook

By Chris Dieterich

OF DOW JONES NEWSWIRES

NEW YORK (Dow Jones)--Stocks advanced after a slightly better-than-expected reading from the jobs market and as investors watched Greece's third attempt to piece together a government.

The Dow Jones Industrial Average futures had gained 83 points, or 0.6%, to 12918. The blue-chip benchmark fell 97 points, or 0.8%, on Wednesday, falling for the sixth session in a row.

The Standard & Poor's 500-stock index advanced 11 points, or 0.8%, to 1365 and Nasdaq Composite gained 11 points, or 0.5%, to 2945.

Financial sector stocks led the market higher. Technology-sector stocks were the only group to lose ground as Cisco Systems slumped 8.4%. The blue-chip networking-equipment company gave a downbeat outlook for the current quarter, though earnings for the previous quarter topped analyst estimates.

In economic news, initial jobless claims fell slightly more than expected, while a reading on the previous week was revised slightly higher. Separately, the U.S. trade deficit widened in March, as a wave of oil imports and Chinese goods overwhelmed record exports. The cost of goods imported into the U.S. fell for the first time since last fall.

European markets turned higher as investors expressed some optimism that Greece would resolve its political situation and after Spain moved to ease worries about its banking system. The Stoxx Europe 600 was up 0.7% after earlier declining 0.7%.

"It's all set against the backdrop of concern for the euro zone, and the ramifications should Greece leave. Investors are coming around to the conclusion that a euro zone without Greece wouldn't necessarily be a bad thing," said Andrew Wilkinson, chief economic strategist at Miller Tabak. "It's very difficult to steer a course through all this headline risk, and to trade equities, because [Europe's issues] completely deflects from U.S. fundamentals."

Asian markets were mostly lower after Chinese trade data suggested a slowing of activity in April, with imports growing much less than expected. Hong Kong's Hang Seng fell 0.5% and lost ground for the sixth consecutive session, while Japan's Nikkei Stock Average fell 0.4%. China's Shanghai Composite inched up 0.1%.

Crude-oil futures rose 0.5% to $97.30 a barrel, while gold futures rose 0.2% to $1,598 a troy ounce. The U.S. dollar slipped against the euro but gained ground against the yen. The yield on the 10-year U.S. Treasury bond rose to 1.894%.

In corporate news, shares of Priceline.com declined 4.2% after the online travel booker reported first-quarter earnings that exceeded forecasts, but provided a cautious outlook for the second-quarter.

Avon Products gained 1.7% after Coty boosted its bid to buy the company by 6.5% to $24.75 a share.

Kohl's dropped 2.2% after the department-store chain reported first-quarter results that beat analyst estimates, but provided a second-quarter earnings outlook that was below current projections.

Monster Beverage surged 10% after the energy-drink maker reported first-quarter results that exceeded expectations as volume and gross margin increased.

Universal Display slumped 11% after the company reported a surprise first-quarter loss as royalty and license fees declined. Analysts had expected a slight profit.

-By Chris Dieterich, Dow Jones Newswires; 212-416-2611; christopher.dieterich@dowjones.com

(END) Dow Jones Newswires

May 10, 2012 09:55 ET (13:55 GMT)