* Spain manages successful debt auction
* Initial jobless claims shy of expectations
* Bank of America, Morgan Stanley up after results
* Indexes off: Dow, S&P; both 0.3 pct, Nasdaq 0.7 pct
By Chuck Mikolajczak
NEW YORK, April 19 (Reuters) – U.S. stocks rose slightly in
a choppy session on Thursday as investors grappled with euro
zone uncertainty, a raft of corporate earnings and economic data
that painted a mixed picture of the domestic recovery.
Spain’s successful debt auction and solid earnings from Bank
of America and Morgan Stanley led to early optimism, but that
quickly dissipated as speculation swirled that France’s
sovereign debt rating could be downgraded. A senior French
source told Reuters the rumors were unfounded.
Citi analysts said in a note it is likely Moody’s will place
France’s Aaa rating on review for possible downgrade by the
autumn. France lost its ‘AAA’ rating earlier in the year and
ongoing budget crises have kept worries about the region near
the front burner for investors.
The FTSEurofirst 300 index of top European shares
fell from earlier highs and traded near flat.
The Dow Jones industrial average was up 34.62 points,
or 0.27 percent, at 13,067.37. The Standard & Poor’s 500 Index
was up 3.68 points, or 0.27 percent, at 1,388.82. The
Nasdaq Composite Index was up 20.59 points, or 0.68
percent, at 3,052.04.
Spain, the latest trouble spot in the euro zone debt crisis,
sold 2.5 billion euros ($3.3 billion) of bonds in a successful
auction, but yields rose as Madrid struggled to tame its
deficit.
“The ECB’s efforts to pump liquidity into the system has
taken fears of a banking crisis off the table, but all the
problems are still there for all these countries,” said Scott
Brown, chief economist at Raymond James in St. Petersburg,
Florida.
“For U.S. investors, it’s just going to be simmering on the
back burner, maybe it comes to the front burner, and back and
forth. It’s still going to be a major issue and is not going to
go away anytime soon.”
New U.S. claims for unemployment benefits fell less than
forecast last week, Labor Department data showed, tempering
expectations for a pick-up in job creation in April after
March’s slowdown.
“The claims numbers at face value, sure it’s a
disappointment for the stock market … We really need to see
another week or two before we conclude the labor market is
slowing down considerably, so I take it with a big grain of
salt,” said Brown.
Bank of America Corp, the No. 2 U.S. bank, climbed
1.2 percent to $9.03 and Morgan Stanley rose 3 percent to $18.17
after they both reported better-than-expected results. The S&P;
financial sector gained 0.3 percent.
Travelers Cos Inc was the top boost to the Dow, up
4.6 percent to $62.21 after the property insurer easily topped
Wall Street estimates and raised its dividend.
Verizon Communications Inc gained 2.3 percent to
$38.53 after earnings and revenues just beat estimates, even as
wireless growth slowed.
According to Thomson Reuters data, 35 companies in the S&P;
500 are due to report Thursday. Notables after the close include
Microsoft Corp, Chipotle Mexican Grill Inc and
SanDisk Corp.
Of the 77 S&P; 500 companies reporting through the opening
bell, 81 percent beat estimates.
Thursday’s slew of economic data sent mixed signals to
investors. The pace of factory activity in the U.S. mid-Atlantic
region waned in April for the first time in five months, while a
gauge of future U.S. economic activity rose in March to the
highest level in nearly four years.
Meanwhile, U.S. home resales fell in March but the supply of
properties on the market tightened as prices inched higher.
Biotechnology issues helped lift the Nasdaq, led by Human
Genome Sciences Inc, up 100 percent to $14.42, and
Gilead Sciences Inc, rising 14 percent to $53.13.
Human Genome rejected an unsolicited $2.6 billion bid from
long-time partner GlaxoSmithKline Plc .
Gilead’s combination of experimental hepatitis C drugs
developed with Bristol-Myers Squibb Co showed impressive
results in a new clinical trial.
U.S.-listed shares of Glaxo gained 1.1 percent to $46.88 and
Bristol-Myers rose 1.9 percent to $34.20. The Nasdaq biotech
index climbed 2.7 percent.
