Stocks turned in a strong performance on Thursday after a batch of economic reports pointed to an improving global economy.
The Dow Jones industrial average closed at 13,232.62, up 136.16 points or 1 per cent. The broader S&P 500 closed at 1427.59, up 15.43 points or 1.1 per cent. In Canada, the S&P/TSX composite index closed at 12,499.76, up 76.85 points or 0.6 per cent and extending its winning streak to six consecutive days.
China provided an early indication that its struggling economy might be showing signs of shaking off recent weakness. It reported that its purchasing managers’ index for October rose to 50.2 from 49.8 in September, close to expectations but more importantly moving above the threshold of 50 that separates contracting and expanding activity.
Meanwhile, the United States provided a flurry of upbeat economic news, just days after Hurricane Sandy devastated the east coast, raising concerns about the economic impact. The ADP report on private sector employment showed gains of 158,000 jobs in October, well above expectations of 135,000 jobs.
This provided more evidence that the U.S. employment situation is making steady improvement. Last month, the Labor Department reported that the unemployment rate dipped to 7.8 per cent. October figures are expected on Friday.
Initial jobless claims fell by 9,000 for the period ended last week, to 363,000, which was slightly better than the 370,000 claims expected by economists.
The Conference Board’s consumer confidence index for October rose to 72.7 from 68.4 in September, marking its highest level since February 2008.
And the ISM index of factory activity in October nudged up to 51.7 from 51.5 in September, beating expectations.
Among the biggest movers within the Dow, Bank of America Corp. rose 4.5 per cent, while Microsoft Corp. and Caterpillar Inc. rose 3.4 per cent each.
Research In Motion Ltd. rose 10.2 per cent after it began testing its upcoming BlackBerry 10 smartphone with wireless carriers worldwide. The move is seen as a key step toward the official launch of the phones next year amid hopes that RIM can turn around its declining market share.
Barrick Gold Corp. fell 9.5 per cent after it reported that its quarterly earnings fell to $620-million or 62 cents a share, down from $1.37 a share last year. It also said that costs associated with its Pascua-Lama project in South America had risen to $8.5-billion.