Stocks zigzag after jobs report; Monsanto warns
NEW YORK — Stocks zigzagged in a tight range early Thursday as investors weighed a better-than-expected jobs report against a downbeat forecast from Monsanto Co.
New jobless claims fell more than expected to 550,000 last week and total unemployment rolls dropped, the Labor Department reported. Those continuing to receive benefits fell by 159,000 to nearly 6.1 million, the lowest level since early April.
Meanwhile, Monsanto said it plans to make deeper work force cuts than previously announced. The world’s biggest seed maker also warned its 2009 earnings would come in at the low end of its previous forecast.
Investors are cautious after stocks posted four straight days of gains. The Standard & Poor’s 500 index has risen 52.8 percent in the six months since hitting a 12-year low in March, and the index now sits at an 11-month high.
Subodh Kumar, global investment strategist at Subodh Kumar & Associates in Toronto, contends that the market has gone too far without a break.
“The fact that it got here without any meaningful corrections means it hasn’t stopped since March to test the validity of its assumptions,” he said.
In late morning trading, the Dow Jones industrial average rose 30.46, or 0.3 percent, to 9,577.68. The broader S&P 500 index rose 3.69, or 0.4 percent, to 1,037.06, and the Nasdaq composite index rose 9.21, or 0.5 percent, to 2,069.60.
The yield on the 10-year Treasury note fell to 3.42 percent from 3.48 percent.
Investors reacted to a mixed batch of corporate forecasts. Monsanto fell $5.11, or 6.1 percent, to $78.37, after the company said it would slash its payrolls by 8 percent.
Procter & Gamble Co. rose $2.21, or 4.1 percent, to $55.97 and was the biggest gainer among the 30 stocks that make up the Dow industrials. The maker of Tide soap and Gillette razors said it expects sales to begin rebounding this fall.
Corning Inc., a specialty glass maker, said it expects higher than previously forecast sales volume for the third quarter. The stock rose 33 cents, or 2.1 percent, to $16.14.
Rising stocks outpaced those that fell 9-to-5 on the New York Stock Exchange, where volume came to 356.8 million shares compared with 363.2 million shares traded at the same point Wednesday.
The Russell 2000 index of smaller companies rose 2.91, or 0.5 percent, to 589.31.
The dollar was mixed against other major currencies and gold fell.
Light, sweet crude rose 54 cents to $71.85 a barrel on the New York Mercantile Exchange.
Overseas, Japan’s Nikkei stock average rose 2 percent. In afternoon trading, Britain’s FTSE 100 fell 0.4 percent, Germany’s DAX index rose 0.4 percent, and France’s CAC-40 fell 0.2 percent.
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