US Stocks Grind Out A Third Gain After Greek Deal, Jobless Claims

Stocks edged higher for a third-straight session, as investors showed tempered enthusiasm for progress toward a new Greek bailout and continued improvement in the U.S. labor market.

The Dow Jones Industrial Average rose 6.51 points, or 0.05%, to 12890.46. The Standard & Poor's 500-stock index gained 1.99 points, or 0.15%, to 1351.95, and the Nasdaq Composite edged up 11.37 points, or 0.39%, to 2927.23.

Technology and consumer-staple stocks led sector gains. United Technologies bolstered the Dow, rising $2.04, or 2.5%, to $83.78. Cisco Systems lagged among blue chips, down 43 cents, or 2.1%, to 20.00 after reporting fiscal second-quarter results late Wednesday.

Stocks initially got a boost after Greek leaders reached a consensus on austerity measures. The moves were needed before Europe's financial ministers and the International Monetary Fund sign off on a new bailout for Greece valued at $172 billion.

But Thursday's action in Europe failed to inspire investors who have watched protracted talks over Greece's debt.

"It's like we're getting messages that have been telegraphed to us for some time," said Robert Pavlik, chief market strategist at Banyan Partners. "It's one hurdle, but how many more to go?"

In the U.S., separate readings on jobs and business activity came in better than expected. Initial unemployment claims fell more than expected last week, at 358,000, versus 370,000 forecast by economists. U.S. wholesale inventories rose more than expected in December, a signal businesses restocked at the end of last year to meet rising demand.

European markets rose on news of the Greek deal but pared earlier gains. The Stoxx Europe 600 added 0.2%, its first gain in four sessions.

Asian exchanges were mixed after an unexpected increase in the Chinese inflation rate. China's Shanghai Composite edged up 0.1%, while Japan's Nikkei Stock Average slipped 0.1%.

Gold futures gained 0.6% to settle at $1,739.00 a troy ounce, while crude-oil futures advanced 1.1% to settle at $99.83 a barrel. The dollar lost ground against the euro but edged higher against the yen. Treasurys ticked lower, with the yield on the 10-year rising to 2.036%.

In corporate news, PepsiCo declined 2.47, or 3.7% to 64.27, after the soft-drink and snack company reported better-than-expected fourth-quarter results but provided a 2012 earnings outlook that was below current estimates. It also announced a restructuring plan that includes cutting its global work force by about 8,700.

Groupon slumped 3.41, or 14%, to 21.17 after the company reported a slight fourth-quarter loss against expectations of a slight profit, although revenue beat estimates, and the first-quarter revenue outlook was above current projections.

TripAdvisor fell 5.00, or 15%, to 29.34, leading the S&P 500 lower, after the company's first quarterly results since its separation from Expedia fell short of estimates and the travel website provided a subdued outlook.

Akamai Technologies shot up 3.62, or 11%, to 38.06, and led the S&P 500, after the reporting better-than-expected fourth-quarter earnings and revenue. Separately, the company said James Benson, currently its senior vice president of finance, will succeed J. Donald Sherman as chief financial officer, effective March 1.

Lorillard's fourth-quarter earnings jumped 20% as the cigarette maker reported higher shipments and gains in Newport and Maverick brands. Shares gained 11.01, or 9.7%, to 124.37.

Visa tacked on 4.07, or 3.8%, to 112.42 after fiscal first-quarter earnings and revenue exceeded forecasts.

Diamond Foods tumbled 13.53, or 37%, to 23.13 after the company's audit committee concluded that financial statements for fiscal 2010 and 2011 will need to be restated and noted "material weaknesses" in the company's internal controls. The company said it was taking corrective actions, including appointing a new chief executive, chief financial officer, and chairman of the board.

Teradata's fourth-quarter earnings rose 15%, as all regions posted double-digit revenue increases and the business-data storage company approved a new $300 million stock-repurchase program. Shares rose 5.90, or 10%, to 63.94.

-By Chris Dieterich, Dow Jones Newswires; 212-416-2611; christopher.dieterich@dowjones.com

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