NEW YORK - US stocks were higher on Thursday as the latest data pointed to an economy that continued to struggle, suggesting that central bank stimulus measures will likely stay intact in the immediate future.
Jobless claims unexpectedly rose in the latest week while a preliminary reading on first-quarter gross domestic product came in slightly under forecasts. Though the data missed expectations, investors have been concerned recently that strong data would spur the Fed to ease off on its stimulus measures sooner than had been expected.
Pending home sales rose 0.3 per cent in April, below expectations for a 1.1 per cent rise. Stocks were little impacted by the data.
Equities have been closely tethered to central bank policy, with shares tumbling on Wednesday as US Treasury bond yields rose to their highest level in more than a year on concerns the Federal Reserve would curb its bond-buying programme. On Tuesday, reassurances from central banks around the world that programs would remain intact had boosted equity prices.
"Markets have been more volatile lately as investors question when the Fed will begin tapering, but these numbers aren't strong enough to have the Fed consider slowing," said Ryan Larson, head of equity trading at RBC Global Asset Management in Chicago.
Initial claims rose by 14,000 to 354,000 in the latest week, confounding expectations that claims would remain unchanged. A reading of first-quarter economic growth showed expansion of 2.4 per cent, compared with expectations for growth of 2.5 per cent.
The Dow Jones industrial average was up 39.41 points, or 0.26 per cent, at 15,342.21. The Standard & Poor's 500 Index was up 6.58 points, or 0.40 per cent, at 1,654.94. The Nasdaq Composite Index was up 17.04 points, or 0.49 per cent, at 3,484.56.
Loose monetary policies by central banks around the world have lifted stock markets, driving both the Dow and the S&P 500 to record highs this year. The S&P 500 is up almost 16 per cent this year so far.
In company news, Costco Wholesale Corp reported third-quarter earnings that beat expectations by a penny, though sales were below forecasts. Shares rose 2 per cent to US$115.25. Solar power companies were among the strongest of the day after Hanwha SolarOne Co and Yingli Green Energy reported positive first-quarter gross margins, suggesting that a five-year decline in prices was easing.
Hanwha rose 2.7 per cent to US$1.94, while Yingli was up 1.2 per cent at US$3.32. First Solar was the top gainer on the S&P 500, up 5.8 per cent to US$54.92.
NV Energy Inc surged 23 per cent to US$23.66 after a unit of Berkshire Hathaway Inc agreed to buy the electric utility for US$5.6 billion.
EMC Corp shares rose 3.7 per cent to US$24.57 in premarket trading after instituting a quarterly dividend and increasing its stock buyback programme to US$6 billion from US$1 billion.