DJIA Soars Nearly 200 Points on Jobs Report, Stimulus Check Spending

Not a "recession," but "tepid growth:

Wall Street rose sharply Thursday after investors got comforting news about the economy -- some better-than-expected retail sales in May and a drop in the number of laid-off workers seeking unemployment benefits. The Dow Jones industrials rose almost 200 points.

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The Labor Department's report that applications for unemployment benefits came in at 357,000 -- a decline of 18,000 from the previous week -- offered investors some relief about the health of the job market a day ahead of a key monthly reading.

While the weekly readings can show volatility, the latest drop left applications for benefits at their lowest level since mid-April. Still, the four-week average for those getting benefits rose to 3.086 million, the highest since March 2004.

Among retailers reporting solid May results, Wal-Mart Stores Inc. said sales at stores open at least a year rose as consumers sought bargains.

Subodh Kumar, global investment strategist at Subodh Kumar & Assoc. in Toronto, said the jobs figures and the Verizon Wireless deal offer some investors reassurance about the health of the economy.

"It looks like the U.S. is not in recession but, I would say, tepid growth," he said, adding that the Verizon bid for Alltel is "encouraging."

"Companies are willing to invest in their businesses," Kumar said.

BizzyBlog notes more good news, with industrial and non-industrial gauges either signaling expansion or slight contraction. All better than expectations.

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Also Interesting: ADP's figures on payrolls keep showing far greater job growth than the BLS's. Everyone assumes the BLS is correct, but what if it's not?

posted by Ace at 04:21 PM

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