Stocks rose significantly Thursday on a mix of optimism about the U.S. government's new version of the financial rescue plan and better-than-expected monthly sales from Wal-Mart Stores. Stocks fell in the morning after a spike in U.S. jobless claims to a 26-year high worsened concerns about the duration of the recession. But the market erased losses and moved higher as investors focused on the few U.S. retailers that posted better-than-expected January sales. Big U.S. retailers reported another weak month of sales as the recession continued to lower consumer spending. However, retail sales have been week for months, and the latest data provided few surprises. Wal-Mart said sales rose 2.1 percent last month, though clothing and luxury retailers were hit especially hard. In economic news, the number of Americans filling new claims for jobless benefits rose by 35,000 to 626,000, a figure far higher than economists had expected. U.S. factory orders fell a sharp 3.9 percent in December after plunging 6.5 percent the previous month, the government said. In a third report, U.S. productivity soared—largely due to output falling more slowly than the fewer hours worked by hundreds of thousands of Americans recently laid off. Light sweet crude oil for March delivery rose 85 cents to $41.17 a barrel on the New York Mercantile Exchange. This U.S. dollar rose versus the euro and the yen. The Dow Jones industrial average rose 106.41, or 1.3 percent, to 8,063.07. Bank stocks gained, including J.P. Morgan Chase, Citigroup, and American Express. Bank of America recovered some lost ground after falling to a more than 20-year low. The broader Standard & Poor's 500 index rose 13.62, or 1.6 percent, to 845.85. The technology-heavy Nasdaq composite index rose 31.19, or 2.1 percent, to 1,546.24. Cisco reported weaker sales and profits that still beat estimates, but the company also said it expects a sales decline of 15 to 20 percent in the current quarter. Despite the weak outlook, its shares rose 3 percent. The New York Stock Exchange composite index rose 83.26 to 5,326.01. The American Stock Exchange composite index rose 22.17 to 1,426.50. And the Russell 2000 index rose 6.60 to 455.08.
