- The Washington Times - Friday, December 25, 2009

NEW YORK | Stocks ended a holiday-shortened session Thursday at new highs for the year after upbeat reports on unemployment and durable goods orders.

A weaker dollar also helped buoy the market, lifting energy and materials stocks. Christmas Eve trading was extremely light.

The encouraging signs of the labor market and consumer demand helped assuage investors, who were disappointed the day before by an unexpected plunge in new home sales last month.

New claims for unemployment benefits fell by 28,000 to 452,000 last week, the Labor Department reported, the latest sign of improvement in the job market. It was the best figure since September 2008, just before the credit crisis peaked, and better than the 470,000 new claims economists had predicted.

Separately, the Commerce Department said orders to factories for durable goods excluding the volatile transportation sector jumped 2 percent last month, double what analysts expected.

Stocks have managed to push higher in December on optimism about the economy, but at a more subdued pace than in recent months. As the year winds to a close, the Standard & Poor’s 500 index was up 66.5 percent since hitting 12-year lows in March.

This week’s trading pattern reflected the market’s recent cautious tone. On Monday, stocks shot higher as another wave of corporate dealmaking boosted investors’ optimism. Two days later, shares barely budged after a disappointing report on housing.

“The news on balance is pretty good,” said Uri Landesman, head of global growth at ING Investment Management. “The market continues to inch higher.”

The Dow Jones Industrial Average rose 53.66, or 0.5 percent, to 10,520.10. The Standard & Poor’s 500 index rose 5.89, or 0.5 percent, to 1,126.48, while the Nasdaq composite index rose 16.05, or 0.7 percent, to 2,285.69. The Russell 2000 index of smaller companies rose 3.09, or 0.5 percent, to 634.07.

Rising shares outnumbered decliners by about 3 to 1 on the New York Stock Exchange, where consolidated volume came to 1.2 billion shares.

Trading had been slow throughout the week heading into the holiday, which can exaggerate swings in stock prices. The market closed at 1 p.m. Thursday and will remain closed Friday for Christmas.

Health care stocks were little changed after landmark health care reform legislation cleared the Senate. Some analysts said the sector could have fared much worse in the bill.

“It’s come off fairly toothless from what it could’ve been,” Mitch Schlesinger, managing partner at FBB Capital Partners, said of the Senate’s version of the health bill. He noted that many big health insurers are still trading near their highs for the year.

Gold prices climbed back above $1,100 an ounce, while oil prices rose 96 cents to $77.63 a barrel on the New York Mercantile Exchange.

Bond prices fell, sending their yields higher. The yield on the benchmark 10-year Treasury note rose to 3.80 percent from 3.75 percent late Wednesday.

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