Stocks Finish with Solid Gains

Indexes climbed Thursday after Alcoa reported a surprise profit and jobless claims fell 33,000. Gold and oil prices continued to advance

U.S. stocks closed broadly higher Thursday as equity investors embraced a better-than-expected third-quarter earnings report from Alcoa (AA), some upbeat September sales reports from major retailers, and data showing a weekly drop in jobless claims.

Stocks tied to the retail, basic materials, energy, and commodities sectors were among the best performers.

Also Thursday, the European Central Bank and Bank of England left interest rates unchanged.

On Thursday, the 30-stock Dow Jones industrial average finished higher by 61.29 points, or 0.63%, at 9,786.87. The broad Standard & Poor's 500-stock index added 7.90 points, or 0.75%, to 1,065.48. The tech-heavy Nasdaq composite index gained 13.60 points, or 0.64%, to 2,123.93.

On the New York Stock Exchange, 22 stocks were higher in price for every eight that declined. Breadth on the Nasdaq was 15-11 positive.

Treasuries fell after a disappointing $12 billion 30-year bond auction.

The dollar index declined amid persistent concerns the U.S. economic recovery and the government's huge and growing debt will spur inflation in the future.

The lower greenback helped gold futures to rally. December gold futures were up $10.20 to $1,054.60 per ounce in afternoon trading, down a bit from a session high of $1059.60.

Crude oil futures also advanced on the lower dollar, with November West Texas Intermediate crude oil futures up $2.21 to $71.78 per barrel in afternoon trading.

In economic news Thursday, U.S. wholesale sales rose 1.0% and inventories fell 1.3% in August. July's 0.5% increase in sales was revised up to 0.6%. Sales excluding petroleum rose 0.3%. Auto sales were up 7.7%. The 1.4% decline in July inventories was revised down to -1.6%. Inventories excluding petroleum fell 1.5%. Auto inventories dropped 2.3%. The inventory-shipment ratio declined further to 1.20 from 1.23 in July.

U.S. jobless claims fell a bigger than expected 33,000 to 521,000 in the week ended October 3, after a revised 554,000 the prior week (was 551,000). The four-week moving average dipped to 539,750 from 548,750. Continuing claims declined 72,000 to 6,040,000 in the week ended September 26, from a revised 6,112,000 (was 6,090,000). That's a second straight weekly decline.

The claims data suggest meager improvement in jobs, and that could give a little extra push higher to stocks and further weigh on Treasuries," says Action Economics.

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