By Victor Reklaitis, MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks jumped Thursday, working
for new record closes after the European Central Bank unveiled a
raft of stimulus measures.
The ECB announced a negative rate on reserves that banks park at
the central bank, in a widely expected move, but it also revealed
several other measures aimed at boosting inflation and encouraging
lending in the euro zone.
In U.S. economic news, a report on weekly jobless claims roughly
matched forecasts.
The S&P 500(SPX) rose 12 points, or 0.6%, to 1,940 after
shaking off a mid-morning decline. The benchmark has hit a new
intraday record, and it's on pace for another all-time closing
high. On Wednesday, the benchmark scored a record close for the
16th time this year.
The Dow Jones Industrial Average(DJI) gained 93 points, or 0.6%,
to 16,831. The blue-chip index also has hit an intraday record on
Thursday, and it's on track for a record close.
The tech-heavy Nasdaq Composite(RIXF) advanced by 341points, or
1%, to 4,293, while the small-cap Russell 2000(RUT) added 21
points, or 1.8%, to 1,152.
The ECB cut its deposit facility to negative 0.10% from 0% and
dropped its main lending rate to 0.15% from 0.25%. The central bank
also announced preparations toward the purchase of asset-backed
securities. The Stoxx Europe 600 closed up 0.4%. (Read more: Few
expected ECB to try so many measures all at once
http://www.marketwatch.com/story/draghi-brings-out-everything-but-the-ecb-bazooka-2014-06-05.)
"The package is immediately significant," said Citi Private Bank
strategists in a note Thursday.
In the U.S., weekly jobless claims rose to 312,000, essentially
in line with expectations of 311,000. On Friday, investors will get
the U.S. government's May jobs report. Economists are expecting a
rise of 210,000 jobs in May, but there is a little trepidation
after private-sector payrolls disappointed on Wednesday, showing
the slowest pace of jobs growth in four months. (Read more: What to
look for in May jobs report
http://www.marketwatch.com/story/what-to-look-for-in-may-jobs-report-2014-06-05.)
Some strategists remain upbeat as U.S. stocks keep climbing.
"The uptrend still has the support of positive short-term
momentum, although a pullback still appears likely in the days
ahead," said Katie Stockton, BTIG's chief technical strategist, in
emailed comments on Thursday. "We believe any weakness should be
viewed as an opportunity to accumulate stocks, given widespread
breakouts and healthy global breadth."
Hedge-fund manager David Tepper, who sounded notably cautious
last month, told CNBC Thursday that the ECB has helped soothe his
biggest market worries.
Late Wednesday, stock bulls got another boost from S&P
Capital IQ. The research firm's Investment Policy Committee --
which has been upbeat on U.S. stocks -- raised its 12-month target
for the S&P 500 to 2,100, up 9% from its prior target of 1,985.
(Read more: Get your money ready for a big S&P 500 rally
http://blogs.marketwatch.com/thetell/2014/06/04/get-your-money-ready-for-a-big-sp-500-rally/?link=instory.)
Among individual stocks, Sprint Corp. (S) fell 3.1% on news the
wireless carrier is nearing a deal to buy rival T-Mobile US Inc.
(TMUS) for $40 a share. T-Mobile dropped 1.9%. (Read more in
MarketWatch's Movers & Shakers column
http://www.marketwatch.com/story/ciena-corp-jumps-on-earnings-pvh-sinks-2014-06-05.)
Joy Global Inc.(JOY) fared best among S&P 500 stocks, rising
6.5% after its quarterly earnings topped expectations. PVH
Corp.(PVH) performed worst, losing 7.5% after it warned of pressure
on its profit margins.
In other markets, August gold (GCQ4) gained ground, while Asian
equities finished largely flat, outside of a 0.8% rise for the
Shanghai Composite .
More must-reads from MarketWatch:
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ECB cuts won't fix economy, but they will anger Germany
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