Stocks managed to notch a modest gain Thursday, with Wall Street cautious ahead of today's jobs report but optimistic that the worst of...
NEW YORK — Stocks managed to notch a modest gain Thursday, with Wall Street cautious ahead of today’s jobs report but optimistic that the worst of the financial crisis has passed.
The Dow Jones industrial average rose 20.20 to 12,626.03.
Microsoft, one of the 30 Dow stocks, slipped 16 cents to close at $29 a share. Boeing, also a Dow stock, fell 71 cents to $76.14.
Broader stock indicators also edged higher. The Standard & Poor’s 500 index rose 1.78 to 1,369.31, and the Nasdaq composite index rose 1.90 to 2,363.30.
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Federal Reserve Chairman Ben Bernanke told Congress Thursday the Fed expects to recover most, if not all, the $29 billion worth of loans it made to keep Bear Stearns from collapse.
Bernanke’s remarks, in which he defended the central bank’s decision to aid JPMorgan Chase’s buy of Bear Stearns, were calming to investors hoping that demand is returning to the tight credit markets.
John Thain, the chief executive of Merrill Lynch, also lent some solace to the market after telling Japanese financial newspaper The Nikkei that the investment bank has sufficient cash and will not need to raise more.
The stock market has been performing well recently due to its newfound confidence about the global financial system — even in the face of poor economic data. Early Thursday, stocks dipped after the Labor Department reported a spike in jobless claims to a level not seen since September 2005.
But the decline was short-lived — particularly given the huge advance Wall Street logged Tuesday and the fact that economists expect the government to report today there was a jobs loss last month.
“I think that the desire to sell is coming off,” said Thomas J. Lee, equities analyst at JPMorgan. The fact that the market has not been shaken by recent disappointing economic data “tells me that the recession is largely discounted.”
“I think we’re going to have a big test coming up,” Lee said. “Are U.S. stocks poised for another downturn, or are U.S. stocks telling us the worst is behind us?”